Homegrown private equity fund ChrysCapital is in advanced talks to acquire a minority stake in Dr Agarwal’s Health Care Ltd, a leading eyecare chain. ChrysCap will invest about Rs 200-250 crore, according to two people aware of the development.
The funds will be used to expand the eyecare chain run by publicly traded unit Dr Agarwal’s Eye Hospital Ltd into new geographies. “ChrysCapital has signed an exclusivity agreement and the discussions moving to an advanced stage,” said one of the persons cited above. Investment bank Veda Corporate Advisors has been signed up by Dr Agarwal’s promoters.
Dr Agarwal’s Health Care, the holding company, owns about 71.75% in the listed entity. Hong-Kong based private equity fund ADV Partners invested $45 million in the company in 2016, allowing Evolvence India Life Sciences Fund to exit. Evolvence India acquired a minority stake in the company for Rs 60 crore in 2012.
Dr Agarwal’s raised Rs 160 crore through a structured debt arrangement from Edelweiss Special Opportunities Fund II in July last year. Dr Agarwal’s currently has 75 eyecare centres, out of which 61 are in India and 14 in Cambodia, Ghana, Mauritius, Mozambique, Nigeria and Rwanda. “We are in the process of raising growth capital to meet our expansion plans and talks are on with several private equity players,” said CEO Adil Agarwal.
According to him, the chain plans to enter new markets in south India and open 50 centres in next two-three years. A ChrysCapital spokesperson declined to comment.
Dr Agarwal’s Eye Hospital posted revenue of Rs 153 crore in the year ended March. The Indian eyecare market is estimated at $1.5-2-billion and dominated by organised players such as Dr Agarwal’s, Centre For Sight, ASG, Eye-Q, Aravind Eye Hospital, Sankara Nethralaya and Narayana Netralaya. In the recent past, single-specialty chains in the areas of eyecare and mother and childcare have seen an increase in venture capital (VC) and private equity (PE) investment.
