Singapore SWF invests further US$50 million into Indian healthcare group

23 May 2014   Category: News, Asia, Global, Singapore   By Maya Ando

GIC Private Limited, the Singaporean sovereign wealth fund (SWF) with US$100 billion in AUM, has jointly invested an additional $50 million into India’s Vasan Healthcare Group, alongside venture capital firms Sequoia Capital and WestBridge Capital.

The second round of investment from GIC comes two years after the SWF bought a $100 million stake in the Chennai-based medical service provider, which specialises in ophthalmology and dentistry.

Sequoia and Westbridge have previously invested $50 million into Vasan across three separate rounds of fundraising. Together, the three investors own 45% of the company, with the remaining shareholding held by chairman and managing director A M Arun.

The latest round of fundraising, made via a rights issue, will be used by Vasan to open 55 new eye clinics and 20 dental clinics by the end of this year.

Since the group was established in 2002, Vasan has grown to 170 eye care centres and more than 750 ophthalmologists, and employs 7,500 staff.

Demand for adequate healthcare services outstrips supply in India, a country of more than 1.2 billion, with spending in this sector forecast to rise from just $45 billion in 2008 to $158.2 billion by 2017, according to a report by Equentis Capital. Figures from the World Bank also show that the Indian government spends just 4% of GDP on healthcare services in the country, which is significantly lower than in other developing economies, such as Russia (6.3%) and China (5.4%).

Earlier this month, GIC’s private equity arm announced its intention to spend $84 million on acquiring 14.4% of Manila-based hospital operator Neptune Stroika Holdings. Stroika is owned by Metro Pacific Investments Corporation, a Filipino investment holding corporation.