According to Business Day, South Africa’s third-biggest private hospital group, Life Healthcare, is exiting its Indian business after almost a year’s talks. It will sell its stake in Max Healthcare to global investment firm Kohlberg Kravis Roberts for about R4.3bn (US$412m).
Life Healthcare took a 26% stake in Max Healthcare, one of India’s biggest private hospital chains, in 2012. It increased its shareholding to 49.7% in two further transactions, investing R2.9bn (US$206m) in the joint venture. As India’s public health system is chronically underfunded, many patients use private health care, but it proved a tough market and Life Healthcare failed to get the returns investors had hoped for.
Life Healthcare CEO Shrey Viranna said exiting the Indian business will enable the company to focus on its core operations in SA, the UK, Poland and Western Europe.
“This is not in any way to detract from Max Healthcare as a group or India as a long-term market. For other investors it is still an exciting environment to be in,” he said.
“In the last year, we have taken the view that our long-term growth will be in building a more integrated portfolio in SA, expanding from acute care into complementary care and diagnostics, and focusing more on the investments we have made in diagnostics and imaging in Europe,” he said.
Life Healthcare has invested R2.2bn (US$156m) in the Polish hospital chain Scanmed, and R13.9bn (US$988m) in the UK-based diagnostic group Alliance Medical, according to its 2017 annual report.