NEA- IndoUS, Peepul Capital script mega exit from MedPlus

Two India-focused venture capital funds - NEA-IndoUS and Peepul Capital are understood to have scripted a mega exit from Hyderabad-based pharmacy and pathology lab chain - MedPlus Health Services.

According to investment bankers close to the deal, these two funds have managed a return of close to 4 times on their investment in this chain, which is growing at a rapid pace. A stake of 35 per cent held by these two funds along with another investor is understood to have changed hands with a transaction size worth Rs 410 crore. This is among the largest deals in this space during the past year, after a Rs 390 crore investment in Metropolis Healthcare by Warburg Pincus during June 2010.

 

According to industry information, MedPlus had raised a total of around $25 million (Rs 115 crore) through three funds over a period of time ranging from 2007-2008. The names of the new set of investors could not be ascertained. Dr Madhukar Gangadi, founder & CEO, MedPlus declined to comment.

While Peepul Capital has $625 million assets under management across three funds, NEA-IndoUS manages a $190 million fund. Started as a discount pharmacy retail chain, MedPlus has moved on to become an integrated health centre chain. In addition to having an established presence in the pharma retailing, MedPlus is now building on what it aims “to be the first call for routine healthcare.” The company has diagnostic lab services which can aid in the prevention, detection, or management of a wide range of illnesses and also ventured in to clinic services.

MedPlus is also known to provide a 10 per cent discount on medicines and up to a 30 per cent discount on lab testing. The company has around 800 points of contacts serving around 100,000 customers daily - majority in South India with expanding presence in Maharashtra and West Bengal. Bankers indicate that the MedPlus is on course to dot 1,200 locations over the next one year. The $5 billion Indian pharmacy retail business has seen a lot of activity in the past few years with large hospital chains ranging from Apollo to Fortis all having significant presence in this sector and further expanding their presence in the pathology labs segment.