KKR Slated to Acquire HCG Cancer Care Hospital Chain

Global private equity giant KKR is set to acquire a controlling 51% stake in Healthcare Global Enterprises (HCG), a leading Bengaluru-based cancer care hospital chain, from CVC Capital Partners, according to sources familiar with the deal. This move signals KKR’s continued push into India’s healthcare sector, which has witnessed significant private equity-led consolidation in recent years.

KKR will acquire 51% of HCG at ?430-440 per share, translating to a 14-16% discount to the company’s Thursday closing price of ?511.45 on the BSE. This amounts to a ?3,128 crore transaction. Post-acquisition, KKR will launch an open offer for an additional 26% stake at ?490 per share, as per SEBI regulations. If the open offer is fully subscribed, KKR's total stake will rise to 77%, with a total deal value of ?4,900 crore.

HCG’s stock has surged 44% in the past six months, driven by its improved financials and speculation surrounding a potential sale. The deal aligns with KKR’s strategy of increasing its footprint in India's healthcare sector. This acquisition follows KKR’s return to Indian healthcare, marked by its 2023 purchase of Baby Memorial Hospital, after previously exiting Max Healthcare, one of its most lucrative investments in the country.

The HCG board is set to meet on Thursday and Friday to discuss quarterly earnings and the transaction. Definitive agreements between key shareholders are expected to be signed in the coming days. Both KKR and CVC Capital Partners have not commented on the deal yet.