India: Metropolis IPO opens 3 April, Carlyle to partially sell stake

Metropolis is controlled by the Shah family, including chairman Sushil Shah and his daughter and managing director of the company Ameera Shah. Photo: Mint

American private equity (PE) firm The Carlyle Group will sell some of its stake in diagnostics chain Metropolis Healthcare Ltd in the latter’s initial public offering (IPO) that opens on 3 April.

The Metropolis IPO is a pure offer for sale of 13.685 million shares, including a sale of up to 6.272 million shares by promoter Sushil Shah, besides another 7.412 million shares by CA Lotus Investments, an entity managed by Carlyle.

The price band for the diagnostics chain’s issue has been fixed at ₹877-880. At the upper end of the price band, the total share sale will be worth ₹1,204 crore.

Carlyle will fetch ₹652.3 crore for the shares it has put up for sale. The IPO values the company at about ₹4,400 crore. It will close on 5 April.

Carlyle, which holds a 31.2% stake in Metropolis, will sell close to half of its shareholding in the company, according to the share sale prospectus filed by the company with the regulator.

The American PE firm had acquired the stake in 2015 by purchasing shares from G.S.K. Velu, the former co-promoter of the diagnostic chain.

Metropolis is controlled by the Shah family, including chairman Sushil Shah and his daughter and managing director of the company Ameera Shah.

For the fiscal year ended 31 March 2018, Metropolis reported revenues of ₹651.5 crore, up from ₹567.6 crore in the previous year. Its profit stood at ₹109.7 crore in 2017-18, compared to ₹107.2 crore in the previous fiscal year.

As of 31 December 2018, Metropolis had a presence across 19 states, mostly in west and south India. During the nine-month period ended 31 December, the diagnostics chain conducted approximately 12.3 million tests of about 6.6 million patient visits, compared to 16 million tests from approximately 7.7 million patient visits, during fiscal year 2018.

The company operates through a “hub and spoke” model, covering 197 cities.

As of 31 December, it had 115 clinical laboratories, comprising a global reference laboratory in Mumbai, its main “hub”, and 14 regional reference laboratories, which are equipped to conduct routine, semi-specialized and a few specialized tests; besides 56 satellite laboratories and 44 express laboratories.

The Metropolis IPO is being managed by investment banking units of JM Financial, Credit Suisse, Goldman Sachs, HDFC Bank and Kotak Mahindra Capital.

In recent years, many diagnostics chains have floated their IPOs, including Dr Lal Pathlabs, which raised ₹632 crore from its share sale in 2015. Thyrocare Technologies Ltd had raised ₹480 crore through its initial share sale in 2016.

So far this year, two companies have raised ₹1,664.29 crore from their IPOs, according to primary market tracker Prime Database.

Also Read:

PE firm Carlyle may exit India’s Metropolis Healthcare before IPO

This article was first published on livemint.com

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.