Bahrain based bank Arcapita Bank B.S.C has announced that its private equity arm has exited its stake in pharma wholesale firm Medplus Health Services Ltd to a consortium of private equity investors in a recent deal.
Arcapita became the largest shareholder in MedPlus in November 2007 in a transaction that valued the Hyderabad based company involved in diagnostic services and wholesale distribution of pharmaceutical products at Rs 290 crore ($72 million), a statement by the firm said.
In March this year, a group of investors led by Mount Kellett Capital Management and joined by TVS Capital Funds Ltd and India Venture Advisors Pvt. Ltd acquired the 34.2% stake held by Arcapita in the company for $90 million, valuing it at $263 million.
This gives Arcapita about 4.2X return over its original investment, according to VCCircle estimates. Arcapita said in the statement that it “acquired its stake in MedPlus as part of its strategy to develop a private equity portfolio in the high growth Indian market”, and this was the first exit from that portfolio. During the holding period, the number of stores grew from 230 to 800 across five states, revenues grew five-fold and gross profit increased six-fold, the statement added.
Atif A. Abdulmalik, Arcapita’s Chief Executive Officer said, “Generally, India has continued to grow steadily through the downturn, and we are pleased that this has been reflected in the performance of MedPlus since acquisition.”
He further added, “Throughout India, we continue to see opportunities in each of our asset classes of private equity, real estate and infrastructure.
Headquartered in Bahrain with offices in Atlanta, London and Singapore, Arcapita’s four principal lines of business are private equity, real estate, infrastructure and venture capital. The bank has completed 71 transactions with a total value of more than $28 billion.
After Medplus deal in 2007, Arcapita had invested in two more companies – Polygel Industries and Idhasoft – in India.