Naresh Trehan’s Medanta files DRHP with Sebi for IPO

MUMBAI: Global Health Ltd, which operates and manages hospitals across India under the Medanta brand, has filed a draft red herring prospectus with the Securities Exchange Board of India (Sebi) looking to raise funds via an initial public offering (IPO).

The IPO comprises issuance of fresh equity shares worth of Rs500 crore and an offer for sale of up to 48.44 million shares by existing promoters and shareholders.

The OFS will see sale of up to 43.34 million shares by Anant Investments and up to 5.1 million shares by Sunil Sachdev.

Naresh Trehan, a world-renowned cardiovascular and cardiothoracic surgeon, founded Medanta in 2004. He has been awarded the prestigious Padma Bhushan and the Padma Shri.

Private equity investors such as Carlyle Group, through its affiliate Anant Investments, and Temasek Holdings, via its affiliate Dunearn Investments Mauritius Pte ltd, hold minority stakes–25.67% and 17%, respectively–in Global Health, while Trehan has a 35% stake. Medanta co-founder Sunil Sachdeva owns 13.43% share, RJ Corp Ltd has 3.95%, and Agio Image Ltd 1.97% stake in the firm.

Kotak Mahindra Capital Co Ltd, Credit Suisse Securities India Pvt Ltd, Jefferies India Pvt Ltd and JM Financials are the book running lead managers to the issue.

The firm intends to utilise 375 crore of the IPO proceeds to repay borrowings availed by its arm Global Health Patliputra Pvt Ltd and Medanta Holdings Pvt Ltd by investing via debt or equity infusion. As of June 2021, Global Health had outstanding borrowings of Rs767.58 crore on a consolidated basis.

The firm currently is a largest private multi-specialty tertiary care providers operating in the north and eastern regions of India, with key specialties of cardiology and cardiac science, neurosciences, oncology, digestive and hepatobiliary sciences, orthopaedics, liver transplant, and kidney and urology.

Its hospital at Gurugram was ranked the best private hospital in India for two consecutive years in 2020 and 2021.

It provides healthcare services in over 30 medical specialties and engages over 1,100 doctors. Operational hospitals have 2,176 installed beds, with hospitals in Patna and Noida expected to commence operations during fiscal 2022 and 2025.

For fiscal 2021, consolidated total revenue stood at Rs1,478.16 crore against 1544.27 crore a year ago. Net profit was at Rs28.81 crore versus Rs36.33 crore last year.

In 2019, TPG and Temasek backed Manipal Hospitals were in talks to acquire Medanta Hospitals, with its board having accepted a binding offer of Rs5,800 crore submitted by Manipal Hospitals. Talks, however, fell through.

As per a Hindustan Times report, in June 2020, the Enforcement Directorate filed a money-laundering case against Medanta Hospital, Trehan, Global Health, Atul Punj of Punj Llyod, Sunil Sachdeva, Anant Jain, and two officers of Haryana Shehri Vikas Pradhikaran, for alleged irregularities in the allotment of land to the hospital in 2004. 

Medanta hospital authorities had denied the allegations as “false, baseless and motivated.”

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