KKR has acquired a controlling stake in leading cancer care hospital chain Healthcare Global from private equity peer CVC Capital Partners for Rs 3466 crore ($400 million), doubling down on the healthcare sector that has already seen massive PE-led consolidation.KKR will be buying 54% of HCG from CVC at Rs 445/share, an 11% discount to Friday’s closing price, the company said in a statement on Sunday after signing definitive agreements. It will then launch an open offer for another 26% from public shareholders, which if fully subscribed to, will take KKR’s ownership to as much as 77%. CVC Capital Partners, which currently owns 60.36%, will retain a 7-9% shareholding at deal closure.Funds managed by KKR will become the largest shareholder in HCG and assume sole control of HCG’s operations, the statement further added. “Healthcare continues to be a thematic focus for KKR in India, our investment in HCG will support the development of medical infrastructure and the delivery of critical oncology services and care to more patients in the country,” said Akshay Tanna, Head of India Private Equity, KKR.ET was the first to report about KKR finalising the HCG acquisition in its February 14th edition. Earlier on December 4th, it was also the first to report that KKR is closing in on the acquisition. 118508770The hospital chain’s stock has appreciated 30.28% in the last 6 months on account of improved financial performance and on anticipation of a sale.. Last year, after acquiring Baby Memorial Hospital KKR made a comeback to the sector after one of its biggest paydays in India exiting Max Healthcare.Following the completion of the transaction, Dr. BS Ajaikumar, an oncologist-turned-entreprenuer who founded the chain in 1989, will take on the role of Non-Executive Chairman and be focused on driving clinical, academic and research and development excellence. He will continue to own 10.87% of the company,“Patient well-being and outcomes will always be a top priority for us at HCG, and in my new role as Non-Executive Chairman, I will focus on clinical aspects involving multi-disciplinary approach to cancer care, and research and development,” said Ajaikumar.HCG operates 25 medical care centers across 19 cities with best-in-class infrastructure including 2,500 beds, nearly 100 operating theaters and 40 linear accelerator machines (LINACs). The company has seen improved efficiencies and have also undertaken growth projects – both organic and inorganic in the recent past. Late last year, HCG acquired MG Hospital in Vizag, a comprehensive care provider with 196 operational beds and healthy margins of 35%. Additionally, it also inaugurated a 200-bed comprehensive cancer care center in Ahmedabad and is adding 125 beds in North Bangalore. The company plans to add 900 incremental beds over the next 4-5 years to capture new opportunities. Its FY24 PAT of Rs 41 crore is expected to cross Rs 200 crore by FY27, as per analyst expectations.KKR will be making its investment from its Asia Fund IV. Beyond hospitals, the US buyoit group has also taken big bets on Healthium, a leading Indian medical devices company; Infinx, a tech-enabled healthcare revenue solutions provider; JB Chemicals, a leading branded formulations pharmaceutical company in India and Gland Pharma, a leading Indian pure-play generic injectable pharmaceutical products company.Luxembourg based CVC Capital which recently part monetised its investment in IPL franchise Gujarat Titans, had bought a controlling stake in HCG in June 2020 for about Rs 1,049 crore by buying new shares and convertible warrants. It will make 3.4 times returns in rupee terms on its initial purchase price of Rs 130/share.“Our partnership with Dr. Ajaikumar and the management team is a testimony to the ability to combine clinical and professional acumen to increase the reach of cancer care in India,” added Amit Soni, Partner, CVC.Goldman Sachs, JP Morgan, Allegro & Ambit were the advisors to the transaction.The transaction is expected to close by the third quarter of 2025, subject to customary closing conditions and regulatory approvals.The cancer industry is growing at a CAGR of 17% and HCG is outpacing the industry growth.