Manipal Hospitals Acquires Majority Stake in Sahyadri Hospitals from Ontario Teachers’ Pension Plan

Key Highlights

 

Ontario Teachers' Pension Plan Board (OTPP) has entered into a deal to sell its majority stake in Sahyadri Hospitals Group to Manipal Health Enterprises, which is one of the largest healthcare deals in India this year. The nearly Rs 6,400 crore deal is pending regulatory clearances and is a major consolidation in the country's rapidly evolving hospital sector.

 

•⁠  ⁠Deal Terms and Strategic Implication

 

OTPP acquired Sahyadri Hospitals in August 2022 for Rs 2,500 crore, which is now Maharashtra's leading hospital chain with 11 hospitals and over 1,400 beds.

 

Under OTPP's guidance, Sahyadri grew rapidly through acquisition and merger, invested in updating facilities, and recruited top medical talent and emerged as the clinical and specialty care leader in the region.

 

The bidding was very competitive with Manipal outbidding several other strong players like Blackstone, Fortis Healthcare with the support of IHH, and EQT Partners. Manipal's successful bid of marginally lower than Rs 6,838 crore reflects its strategy to consolidate its position in the region of Western India.

 

•⁠  ⁠Impact on Indian Healthcare Scenario

 

With this deal, Manipal Hospitals backed by Temasek and TPG Capital will have 12,000 beds in India, second only to Apollo Hospitals.

 

The deal is an indication of mounting demand from private equity players and foreign investors for India's healthcare sector, driven by rising health demand, insurance penetration, and industry consolidation.

 

OTPP's exit realizes a 2.6x return on its three-year investment, proving the high-growth nature of the sector and investors' appetite for high-quality hospital assets.

 

•⁠  ⁠Advisors and Next Steps

 

Jefferies, Alvarez & Marsal, EY, Latham & Watkins, and Trilegal represented OTPP and Barclays, Allegro Capital, Deloitte, and Cyril Amarchand Mangaldas represented Manipal. The transaction will be finalized with the regulatory approvals, after which Manipal will consolidate Sahyadri's network and expertise into its national operations.

 

Sources: Economic Times, Medical Buyer, Moneycontrol