MedPlus promoter buys out existing PE investors
MUMBAI: The promoter of MedPlus Health Services Pvt. Ltd, the second largest pharmacy retail chain in India, has raised around ₹700-750 crore (approximately $115 million) in debt financing from Goldman Sachs to buy out existing private equity investors, said two people aware of the development.
MedPlus was founded by Madhukar Gangadi. The private equity investors were US-based Mount Kellett Capital Management Lp, TVS Capital Funds Ltd and Ajay Piramal’s India Venture Advisors Pvt. Ltd. The three investors together held a 69% stake in MedPlus.
Mount Kellett held 49% in MedPlus through its arm MKCP Direct Investments (Mauritius) IV Ltd, TVS Capital’s TVS Shriram Growth Fund I owned 10.59% and Piramal-led India Venture Trust Fund-I held 9.09%, according to regulatory filings.
“MedPlus promoter has recently raised around ₹750 crore from Goldman Sachs through debt financing in order to buy out the three PE funds, which had been looking for an exit for quite some time. Madhukar Gangadi now owns around 90% stake in the company,” one of the two people cited above said, requesting anonymity as he was not authorised to speak to reporters.
In August, Mint reported that private equity funds General Atlantic and True North were in talks to jointly invest around $200 million in MedPlus by buy- ing out the stakes of the three existing investors.
“The company plans to go public in the next 12-18 months,” added the first of the people cited earlier.
Goldman Sachs declined to comment on the development. Emails sent to Gangadi did not elicit any response.
“We confirm exit of our investment in MedPlus health services. All the PE investors including ourselves have exited through buyout by the promoter. We can only confirm that the promoter has organized debt finance for the buyout, but details of the same are not available with us,” TVS Capital said in an email.
Gangadi, a physician with an MBA from the University of Pennsylvania’s Wharton School, set up his first medical store in Hyderabad in 2006. Today, MedPlus has over 1,400 stores spread across 12 states in India, employing around 10,000 people and serving over 250,000 customers a day.