Asia Healthcare Holdings (AHH), the single speciality healthcare delivery platform backed by TPG Growth, which has successfully created niche healthcare chains in oncology, mother and child care, and fertility, is planning similar investments in single specialities like ophthalmology, gastrointestinal, nephrology and others.
"We have already invested close to US$200 million in our current specialties creating significant size, scale and profitability in each of these companies to give them market leadership in 4-5 years. We can now replicate these learnings in other single specialties and support their growth agenda,” Vishal Bali, executive chairman of AHH, told BusinessToday.In.
Asia Healthcare Holdings, which has become a unique case study in India’s healthcare sector backed by PE/VC, was conceived by TPG Growth as an operating and investment platform. Its focus is to drive the opportunity of scaling different single specialty companies under one platform giving each of them the operating skills of the highly experienced AHH team. It was launched in India in 2016 after acquisition of Cancer Treatment Services International (CTSI) for $38 million.
CTSI had then started the American Oncology Institute (AOI) chain of Cancer hospitals In India. At the time of investment AOI had only two cancer hospitals which in three years grew to a chain of 11 cancer hospitals with a pipeline of six more hospitals under execution. Each of the hospitals had a combination of radiation, medical and surgical oncology. Soon the chain became the fastest growing cancer hospitals network in the country. In May 2019, US based listed radiation oncology treatment solutions specialist Varian Medical Systems acquired CTSI for $283 million (Rs 1,972 crore), in one of the largest healthcare sector deals in India in recent years.
In 2016, AHH took majority control of Bangalore-based Rhea Healthcare with an investment of $33 million. Rhea Healthcare was then operating three mother and child care hospitals under the brand 'Motherhood' in Bangalore, Chennai and Hyderabad. Motherhood is now the fastest growing chain of women and children's hospitals with 13 hospitals spread across seven cities with multiple new hospitals being launched in FY22 across the country with a clinical ecosystem having 900 gynaecologists and neonatologists. The company handles over 1,000 birthings per month.
Similarly, in May 2019, AHH acquired a then loss-making Nova IVI Fertility for US$ 100 million which had a legacy of about a decade. It was India’s second largest network of IVF centres running 19 centres in 15 cities. Nova IVF turned profitable six months after the AHH acquisition and is now on track to become a 50 IVF centre network in FY22.
"Our AHH platform will potentially cross revenues of Rs 800 crore making it the largest Mother & Child platform in the region with sector leading unit economics," says Vishal Bali, who plans to double the number of centres of Nova and Motherhood within next five years.
"Capital efficiency both at the Capex and Opex level with best in class management teams and the right market execution can lead to much higher return on capital employed (ROCE) in single specialities when compared to the large format multi-speciality hospitals, says Bali, who has in the past created numerous 250-plus bedded multi-specialty hospitals in India for Wockhardt and Fortis Healthcare.
Veteran healthcare specialist Vishal Bali joined Wockhardt Hospitals as a management trainee and went on to become its CEO. Post Wockhardt Hospitals acquisition by Fortis Healthcare in 2009, he became Fortis Healthcare's Global CEO and led its operations in 10 countries. Since 2014 he has been associated with TPG Growth.
He also co-founded Medwell Ventures, which runs 'Nightingales,' India’s leading home healthcare services company across four large metros. "It takes care of over 100,000 families, the covid pandemic has proven that home healthcare is an idea which has arrived as a key stakeholder of the healthcare ecosystem in the country," says Bali.
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