Global buyout funds in the fray to buy into ASG Eye Hospitals

MUMBAI: Top buyout funds General Atlantic, TA Associates and KKR are contenders to acquire a significant stake in ASG Eye Hospitals, the largest eye care hospital chain in India, two people aware of the developments told ET. The new investor is likely to acquire around 49% stake in ASG for ₹1,100 crore ($150 million).

Sources said that in this proposed round, existing investor Investcorp will sell its 15% stake, while around ₹700-800 crore will be invested as the primary capital. The deal will value ASG at ₹2,300 crore ($300 million).

ICICI Securities is running the sale process. Sources said binding bids are expected to be received by the end of this week.

Presently, promoters of Jaipur-based ASG hold around 48% stake, while the rest is held by existing investors – Investcorp, Foundation Holdings and Symphony International Holdings.

ASG Eye Hospitals is set to sell around 49% stake in the chain and has approached a slew of PE funds, including General Atlantic, ET first reported in March.

ASG Eye Hospitals spokesperson said, “ASG continues to engage in discussions with various investors and lenders to promote this growth strategy. ASG prefers not to comment on market rumors and speculation.”

Spokespersons of GA, KKR, declined to comment, while mails sent to TA, Investcorp did not respond till press time.

Started in 2005 by Arun Singhvi and Shilpi Gang, ASG provides end-to-end ophthalmology services related to Cataract, Retina, Glaucoma and Refractive issues. It has a network of 44 eye hospitals in 33 cities of India.

Through its subsidiaries, ASG also operates eye care centers in Kathmandu, Nepal and Kampala, Uganda. The hospital has more than 180 ophthalmologists from different branches of ophthalmology. Under the NCLT process, the creditors had cleared ASG’s Rs 550 crore proposal to acquire debt-ridden eyecare chain Vasan Eye Care. ASG earns about 69% of its total sales from 5 states – Rajasthan (23%), Bihar (15%), West Bengal (13%), Assam (10%) and Uttar Pradesh (9%) – a recent report by CARE Report rating shown. Hence, the acquisition of Vasan is expected to give ASG a firm hold in the South Indian market.

ASG’s total operating income (TOI) increased from ₹90 crore in FY17 to ₹144 crore during FY21.

In its final round, ASG raised ₹308 crore in 2019 in a round led by UAE-based family investment office Foundation Holdings.

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