Quasi-sovereign wealth fund NIIF (National Investment and Infrastructure Fund), which is backed by the government and leading institutional investors such as ADIA (Abu Dhabi Investment Authority) and Singapore’s Temasek is in advanced discussions to purchase a minority stake in billionaire Ranjan Pai-controlled Manipal Hospitals, people with knowledge of the matter told Moneycontrol.
“Deal talks are in the final stages and NIIF is looking to pump in around Rs 2,000 crore in Manipal Hospitals in lieu of a minority stake dilution by the promoter Pai,” said one of the persons cited above.
A second person familiar with the proposed deal said Manipal Hospitals plans to use the stake sale proceeds to part-finance the recent acquisition of the Indian assets of Columbia Asia Hospitals. "A portion of the funds is also likely to be used to repay debt related to the education business of the group.”
Bengaluru-based Manipal Hospitals is backed by TPG Capital and Temasek.
“Hospitals are a long gestation play and it’s a good idea for Manipal Hospitals to partner with the government of India and also get access to a bouquet of top-quality global investors who support NIIF. An official announcement on the deal is likely to be made shortly,” a third person told Moneycontrol.
All the three persons spoke to Moneycontrol on condition of anonymity.
Moneycontrol is awaiting responses to email queries sent to NIIF and Manipal Hospitals and will update this article as soon as it hears from both the firms.
Manipal Hospitals is targetting an IPO in the next two or three years. It had earlier explored potential deals with Fortis Hospitals and Medanta Medicity, which did not fructify and in November 2020, it announced the buyout of the Indian assets of Columbia Asia Hospitals for around Rs 2,100 crore.
THE NIIF MANDATE
NIIF was set up in December 2015. According to its website, “with a $3 billion commitment from GOI along with commitments from other institutional investors, NIIF has the ability to operate at scale whilst providing long-term and patient capital. It intends to be a key channel of investment into Indian infrastructure with a focus on transportation (roads, ports and airports), energy, urban planning and other infrastructure and allied segments.”
Somerset Indus Healthcare India Fund is one of the funds falling under the NIIF umbrella. “Some of the sub-sectors within the healthcare ecosystem where the fund would seek to invest include: healthcare delivery, diagnostics, medical equipment and pharma distribution,” says the website.NIIF’s current portfolio includes renewable energy player Ayana Energy, a ports and logistics platform, Hindustan Infralog Private Limited in partnership with DP World and a road portfolio includes Devanahalli Tollway and Dichpally Tollway.