$1 billion race for Indira IVF: BPEA EQT may have edge; Blackstone, others also in fray

Indira IVF has 115 plus centres across the country and a workforce of over 2,200 people.

The hotly contested race for acquiring a majority stake in India's largest IVF (in vitro fertilization) speciality clinics chain Indira IFV is approaching the final lap with BPEA EQT likely to have an edge over other private suitors which include rival Blackstone, multiple industry sources in the know told Moneycontrol.

"Yes, currently BPEA EQT seems to have an edge over others and in terms of valuation discussions, pace of negotiations and intent, has emerged as the most aggressive player so far. The Blackstone team is also at it and is close behind. The domestic fertility market is booming and hence the strong interest from global funds," said one of the persons cited above.

"The binding bids for the proposed transaction have not been submitted as yet and the deal scenario may change at a later stage depending on any revisions," another person warned, adding that CVC Capital Partners and General Atlantic are the other private equity funds which have expressed interest in the deal.

According to a third person familiar with the sale process of Indira IVF, "BPEA EQT has the strategy of picking the best assets in the sector and then paying value or more if required. They are really keen on this asset and the deal could value the entire firm at around $1 billion."

A fourth person told Moneycontrol that the transaction structure had not been finalised as yet and it was unclear how much stake would be eventually sold by TA Associates and the promoter group. TA Associates purchased a significant minority stake in the firm for an undisclosed amount in 2019.

All the four persons cited above spoke to Moneycontrol on condition of anonymity.

In response to an email query from Moneycontrol, Indira IVF said, "At this time, it is important to note that we are in the early stages of the process. As a result, we are unable to provide specific details or comment on any potential outcomes. Our priority is to ensure that any decision we make aligns with our long-term strategic objectives for our patients, employees and shareholders. We understand the interest surrounding this matter and appreciate the curiosity from the media and the industry. Rest assured, as soon as there are material developments to share, we will communicate openly and transparently. Until then, we kindly request your patience and understanding as we navigate this process. We remain focused on delivering our mission and serving our patients to the best of our abilities”.

BPEA EQT and Blackstone declined to comment. Moneycontrol is awaiting an email response from TA Associates and could not elicit an immediate comment from CVC Capital Partners and General Atlantic.

In June, a consortium of BPEA EQT and Chrys Capital sealed the buyout of top education loan provider HDFC Credila for $1.3 billion in India's biggest-ever private equity deal in the financial services segment.

In his first interview with Indian media post the landmark deal, Jimmy Mahtani, Head, BPEA EQT India spoke to Moneycontrol on the road ahead post the Credila gameplan, BPEA EQT's India M&A strategy, opting for the consortium route and more.

On January 30, 2023, Bloomberg was the first to report that private equity firm TA Associates-backed Indira IVF was weighing a sale process. Later In May, the Economic Times reported that Goldman Sachs and JP Morgan had launched a formal sale process which had elicited interest from multiple global buyout funds.

INDIRA IVF, M&A ACTION AND MARKET BOOM

According to its website, with more than 40 years in business, Indira IVF has grown to have 115 plus centres across the country with more than 250 fertility experts and a workforce of over 2,200 people.

"The organisation has invested in several technologies such as RI witness technology, closed working chambers technology, artificial intelligence (AI), microfluidics, and more. It is by means of empathy and meticulous standardization processes that we have been able to attain a 74 percent success rate at Indira IVF so far, making Indira IVF the most preferred fertility chain of hospitals in the country, " the website adds.

Last month, TPG Growth-backed Nova IVF acquired Wings IVF to expand its presence in Gujarat. In April, Brussels-based Verlinvest acquired a controlling stake in Ferty9 Fertility Center, marking its debut investment in India's healthcare sector.

According to a recent report on CNBC TV-18.com, "Currently, India conducts an average of 2-2.5 lakh IVF cycles per year. However, projections indicate that this figure could reach 5-6 lakh cycles annually, resulting in a market value surpassing $3,721 million by 2030, compared to $793 million in 2020.