The Pai family has ceded control of Manipal Health Enterprises (MHE), one of the country’s largest hospital chain.

Singapore’s sovereign wealth fund Temasek is purchasing an additional 41 per cent stake in Manipal Health in a deal reportedly worth more than Rs 16,300 crore ($2 billion).

The deal, which is the largest transaction in Indian healthcare, will take Temasek’s total shareholding in Manipal Health to 59 per cent.

MHE, based in Bangalore, runs a chain of 29 hospitals under the brand name Manipal Hospitals in 16 cities, with nearly 8,300 beds.

Temasek will buy the additional stake from Manipal founder Ranjan Pai’s family, TPG and the National Investment and Infrastructure Fund (NIIF).

While financial details were not disclosed in a joint statement, it is understood that Temasek’s purchase of the additional stake will be for more than Rs 16,300 crore. It would thus value MHE at around Rs 40,000 crore, making it the largest deal in the Indian healthcare sector.

The Pai family’s stake will reduce to 30 per cent from a little over 50 per cent in MHE following the deal. Temasek, already held an 18 per cent stake in the company through a wholly-owned subsidiary Sheares Healthcare Group.

TPG, which first invested in MHE through TPG Asia VI in 2015, will fully exit.

It will re-invest through its new Asia fund – TPG Asia VIII — resulting in its stake standing at 11 per cent from 21 per cent earlier.

“We are very glad for Temasek’s acquisition of a significant stake in Manipal Health Enterprises and its support to the management team in building out the platform to its full potential,” Manipal group chairman Ranjan Pai said in the statement.

He added that investing in healthcare requires a long-term outlook as well as a sensitivity to social responsibility.

“I am glad that we have partners like Temasek and TPG who resonate with these values and will continue to be a part of the journey ahead.”

“I am also grateful to NIIF who partnered us at a critical juncture, at the peak of the Covid-19 pandemic and supported us as we continued to provide high-quality healthcare,” Pai said.

TPG Capital Asia co-managing partner Puneet Bhatia said that by re-investing through Asia fund — TPGAsia VIII — the company looks forward to continuing to support Manipal’s mission of bridging the quality healthcare infrastructure gap in the country.

Some of the other megadeals that have happened in India’s healthcare sector include the sale of 27 per cent for Rs 9,100 crore byKKR in Max Healthcare last year and Malaysia-based IHHHealthcare’s purchase of 31.17per cent stake for Rs 4,000crore in Fortis in November 2018.

Temasek has a net portfolio value of $297 billion as of March 31, 2022.

Stake shake

■ Temasek raises stake to 59% from 41%

■ Pai family stake down to 30% from 50%

■ Deal values Manipal Health at Rs 40,000cr. Transaction largest in healthcare space

■ Manipal runs a chain of 29 hospitals