Kauvery Hospitals Receives USD 70 Million Investment from IIFL AMC for a Minority Stake
Sri Kauvery Medical Care (India) Limited (“Kauvery Hospitals”), has successfully raised equity funding of USD 70 mn from private equity fund managed by IIFL Asset Management Limited (“IIFL AMC”) for a minority stake.
Kauvery Hospitals, one of the leading hospital chains in South India, spearheaded by Dr. S Chandrakumar and Dr. S Manivannan, has built a strong foothold in its focus markets of Tamil Nadu and Karnataka over two decades and has emerged as one the leading hospital chains in South India. Established in 1999 as a 30-bedded hospital, it has scaled its presence to a network of 8 facilities comprising 1,500 beds spread across six cities viz. Chennai, Trichy, Bangalore, Salem, Hosur and Tirunelveli. The Company has been backed by reputed Indian and global investors viz. Lightrock and Dr. GSK Velu’s family office, to achieve its current scale and market positioning.
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The hospital network offers a high-quality comprehensive care across specialties with a strong focus on cardiology, oncology, neurology, renal sciences, orthopaedics, and organ transplants, amongst others. IIFL AMC, part of 360 ONE, is one of India’s leading alternates asset management firms with overall alternate assets and public market mandates of more than USD 7 billion. IIFL PE is a premier private equity business with an AUM of approximately USD 3 billion and investment strategies extending from mid-stage venture capital to pre-IPO investments. IIFL PE has backed several market-leading companies with a focus on healthcare, technology, financial services and consumer industries.
The investment holds significance in Kauvery Hospitals next phase of growth which is likely to move towards an IPO tentatively in the next 3 years, which comprises augmenting capacities in Chennai and Bangalore, along with expansion in chosen clusters within Tamil Nadu and Karnataka. This also marks IIFL PE’s maiden investment in the multi-specialty hospitals segment and is also amongst the few minority investments in the multi-specialty space in India in the recent times.
“Kauvery is currently in the midst of a fast-paced expansion program, as it plans to reach 1,000 beds each by 2025 in Chennai, Bengaluru and Tamil Nadu clusters. This ramp-up would mean that the network shall comprise 15 hospitals spread across 7 cities in South India, with 3,000+ beds and shall likely go for an IPO, in the next 36 months,” Dr. Chandrakumar, Founder and Chairman of Kauvery Hospitals Group said. He added, “IIFL PE has successfully backed numerous growth stories, and their presence on board will accelerate our organic and acquisitive growth across the South India market.”
Dr. Manivannan, Founder and Managing Director of Kauvery Hospitals said, “Kauvery continues to provide the best-in-class personalised care with the highest standards of clinical protocols and ethical practices. This is a key differentiator for us, and a primary driver of our growth and profitability across all our existing regions. We look forward to having IIFL PE as a valued partner and leverage from its expertise of growth investments within and outside of healthcare.”
“Our investment in Kauvery Hospitals underlines IIFL AMC’s increasing focus on investments in the healthcare businesses that offer comprehensive and affordable care to a broader set of patients,” said Nidhi Ghuman, Sr. EVP at IIFL AMC. “Kauvery has strived to stay abreast in identifying the gaps in affordability and accessibility of healthcare services, and consequently leveraged its capabilities to fill those spaces in its focus markets. We’re thrilled to be partnering with a stellar leadership and their management team to further scale their reach across South India,” she added. o3 Capital acted as the exclusive financial advisor and Shardul Amarchand Mangaldas & Co. acted as the legal advisor to Kauvery Hospitals while Jerome Merchant + Partners acted as the legal advisor to IIFL AMC on this transaction.
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