Metropolis Healthcare NSEI:METROPOLIS Stock Report

GSK Velu Reportedly in Talks with Investors, PEs & Banking Firms to Buy Back Metropolis Healthcare

GSK Velu is exploring a bid for Metropolis Healthcare Limited (NSEI:METROPOLIS) the company he once co-funded with the Shah family, seven years after selling his stake following a boardroom battle, people aware of the development said. Velu, the founder of Trivitron Healthcare, is believed to be in talks with a bunch of investors, including two large private equity funds and half a dozen banking firms, to raise money to finance his bid for the diagnostics chain. Metropolis chief executive Ameera Shah and her family has initiated a formal process to sell the controlling promoter stake and is understood to have hired investment bank Barclays to initiate a formal sale. "Velu is definitely exploring to bid, although it's still unclear whether he would be able to clinch the transaction. He is definitely looking to bid for the asset if the Shah family is completely exiting from the venture," a source close to Velu said. A few PE funds, including Warburg Pincus and TA Associates, are also believed to be exploring bids to buy Metropolis in a deal valued at around INR 78,000 million. Warburg Pincus is a US fund with a strong presence in the Indian healthcare space. It was one of the shareholders in Metropolis with a 27% stake, which it had acquired from ICICI Venture in 2010. The Shah family had bought back the stake from Warburg in 2015. Warburg Pincus LLC may also jointly bid with Velu, sources said. Velu and Metropolis declined to comment, while Warburg Pincus and TA Associates Management, L.P. did not respond to emails till press time on June 12, 2022. Amazon.com, Inc. (NasdaqGS:AMZN), Flipkart Online Services Pvt. Ltd., and Adani Enterprises Limited (BSE:512599) are also said to be exploring bids for the healthcare chain.

Metropolis Confirms Promoters Have No Intention to Exit the Business

Adani, Apollo Reportedly Explore Bids for Majority Stake in Metropolis

Billionaire Gautam Adani and Apollo Hospitals Enterprise Limited (NSEI:APOLLOHOSP) are evaluating bids to pick up a majority stake in diagnostic chain Metropolis Healthcare Limited (NSEI:METROPOLIS), two people familiar with the development said. The deal size, given the market cap of Metropolis and its operations across the country, could be at least $1 billion (INR 77,650 million), they added. In May 2022, Mint reported that Adani Enterprises Limited (BSE:512599) is planning a massive foray into the healthcare sector and may acquire large hospitals, diagnostic chains, and both offline and digital pharmacies. The group is said to have earmarked as much as $4 billion for the business, to gain a foothold in the healthcare space and is talking to investors and lenders to devise a long-term funding plan. A Metropolis spokesperson declined to comment on the development, whereas email queries sent to Adani Group and Apollo Hospitals went unanswered till press time.

Price target decreased to ₹2,461

Down from ₹2,748, the current price target is provided by 1 analyst. New target price is 52% above last closing price of ₹1,617. Stock is down 30% over the past year. The company is forecast to post earnings per share of ₹44.07 for next year compared to ₹41.87 last year.