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Emirati state-owned Mubadala Investment Company is reportedly in talks to acquire a stake of less than 10 per cent in India’s Manipal Hospitals. This could be seen as the Abu Dhabi sovereign fund’s first investment in the booming Indian healthcare space.
Mubadala is holding talks with Singapore’s Temasek, which spent $2 billion in April to raise its stake in Manipal to 59 per cent from 18 per cent in the biggest hospital sector deal in India, Reuters reported quoting sources.
According to the report, the talks to acquire a small stake from Temasek are at the same April deal valuation of $5 billion, which implies a value of up to $500 million for the Mubadala-Temasek stake deal.
Manipal Hospital did not respond to media queries. The Singapore state investment firm’s talks with Mubadala, which manages $276 billion globally, are at an early stage, the report added.
Temasek is keen to sell a small stake as it “wants to de-risk a little” and valuations are good, a second source quoted in the report said.
And Mubadala is “bullish on India (and) wants to double down on investments,” the source added. “Healthcare is an attractive space with high margins.”
Temasek intends to retain its majority stake in Manipal by continuing to be the largest and majority shareholder with a stake of more than 50 per cent, said a third source mentioned in the report.
Investor interest has grown rapidly in India’s healthcare market after the COVID-19 pandemic amid a surge in demand for services. India’s private healthcare space, worth about $48 billion, is forecast by PwC to grow 12 per cent to 14 per cent a year.
Manipal, headquartered in the tech hub of Bengaluru, runs 29 multi-specialty hospitals, mainly in south India, and says it is the country’s second biggest chain, focusing on areas such as cardiology, neurosurgery and cancer care.
An investment from Mubadala will also help Manipal if it wants to expand its business in the Middle East and needs “strategic advice”, the second source said.
Mubadala has invested $4 billion in India, including investments in billionaire Mukesh Ambani’s telecom and retail businesses, as well as Tata Power’s renewable energy unit.
It considers India a “priority market” in Asia and Khaled Abdulla Al Qubaisi, its chief executive for real estate and infrastructure investments, told the Economic Times newspaper in May the fund was “really serious about deploying more in India”.
Mubadala has also bet on healthcare elsewhere. In 2015, it brought renowned U.S-based medical centre Cleveland Clinic to Abu Dhabi, and in April this year combined its healthcare assets with Emirati intelligence firm G42 into a new company named M42.
(With Reuters inputs)
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