SBI General Insurance, Abakkus pick 1.6% stake in Park Hospital at more than Rs 7,000-crore valuation

Park Hospital IPO News

SBI General Insurance Company, and ace investor Sunil Singhania's Abakkus Asset Manager have acquired 1.6 percent equity stake in the Gurugram-based Park Medi World that operates hospital chain under the Park Hospital brand, at a valuation of Rs 7,187 crore.

Promoter Dr Ajit Gupta has transferred 30.86 lakh equity shares (0.8 percent of paid-up equity capital) to SBI General Insurance Company on November 7 for Rs 50 crore, while another 30.86 lakh shares were transferred on November 10 to Abakkus Diversified Alpha Fund, and Abakkus Diversified Alpha Fund-2 for same value, the company said in its notice to investors on November 12.

Both transactions involving transfer of 61.72 lakh shares have taken place at a price of Rs 162 per share. As a result, the shareholding of Ajit Gupta in the company has been reduced to 86.64 percent, from 88.23 percent earlier.

This is a part of Rs 192 crore worth pre-IPO placement planned by Park Medi World which has filed Draft Red Herring Prospectus (DRHP) with the SEBI in March this year to raise funds up to Rs 1,260 crore via initial public offering (IPO). The capital markets regulator approved these draft papers on August 14 this year.

The IPO will comprise of fresh issuance of shares worth Rs 960 crore, and an offer-for-sale of Rs 300 crore worth shares by promoter Ajit Gupta.

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Incorporated in 2011, Park Medi World that claims the second largest private hospital chain in North India with total capacity of 3,000 beds, and the largest private hospital chain in Haryana with 1,600 beds, operating a network of 13 NABH accredited multi-super specialty hospitals under the Park brand, as of September 2024.

The company, competing with several listed peers like Apollo Hospitals Enterprise, Fortis Healthcare, Global Health, Jupiter Lifeline Hospitals, Krishna Institute of Medical Sciences, Max Healthcare Institute, Narayana Hrudalaya, and Yatharth Hospital, proposed to utilise Rs 410 crore of fresh issue proceeds for repayment of certain borrowings.

Further, Rs 110 crore will be used for development of new hospital and expansion of existing hospital by subsidiaries Park Medicity (NCR) and Blue Heavens, Rs 77.2 crore for purchase of medical equipment, and the remainder funds for inorganic acquisitions and general corporate purposes.

The merchant bankers for the Park Hospital IPO are Nuvama Wealth Management, CLSA India, DAM Capital Advisors, and Intensive Fiscal Services.