Norwest Venture Partners is close to buying a 40% stake in Regency Healthcare for up to ₹600 crore in a deal that will involve both an expansion of the equity base and transfer of existing shares to the Wells Fargo-backed buyer, sources aware of the deal structuring told ET.
US banking giant Wells Fargo is the main institutional limited partner in Norwest Venture Partners. Norwest and Regency Healthcare could finalise an agreement within two weeks, the sources cited earlier said.
Regency Healthcare is promoted by Kanpur-based Atul Kapoor. It operates a 1,000-bed hospital in the city and also runs dialysis clinics in a JV with Germany’s Fresenius Medical Care, the world leader in the management of end-stage kidney diseases.
International Finance Corporation (IFC) and HealthQuad invested around $14 million in Regency Healthcare in 2016. Both will exit as part of the arrangement. Atul Kapoor, Norwest Venture, IFC and HealthQuad did not respond to ET’s requests for comment.
IFC is the World Bank’s private investment arm. According to a note explaining the rationale for its investment in Regency Healthcare that is publicly available, IFC noted that its investment would finance the increase in hospital beds of the company in UP, one of the most underserved regions in terms of healthcare infrastructure. As per the note, Regency was also setting up the first cancer hospital in UP at the time the investment was being inked.
HealthQuad is a healthcare-focused venture capital fund set up by Sunil Thakur, Abrar Mir, Amit Varma and Kois, a global impact finance firm. It raised a second fund of $162 million in March last year from several global investors led by biopharmaceutical major MSD – or Merck, Sharp & Dohme. Norwest Venture Partners manages a $12.5-billion investment portfolio across North America, Israel and India.
Some of its active investments in India include Xpressbees Logistics, Duroflex and Swiggy. It was also a past investor in Thyrocare and RBL Bank.
