Serial entrepreneur GSK Velu’s association with pathology chain Metropolis Healthcare Ltd may take a turn for the worse, if a media report is to be believed.
Velu, who was a co-promoter of the healthcare company, had made a controversial exit two years ago.
Mint, citing three unidentified people, reported earlier on Wednesday that the Carlyle Group had sent a legal notice to Velu in March for violating a non-compete agreement he had signed in 2015 when he had sold his 37% stake in Metropolis to the private equity firm.
Carlyle refused to comment. Velu in an email statement said: “I do not like to comment on any speculative articles. We take all our legal and moral commitments with all our partners and associates seriously, and comply with all of them in line with ethical and established business principles.”
He further went on to add that he has “no legal disputes with any one as on date and response to these queries based on speculative articles are unwarranted at this point in time”.
The business daily said the legal notice was triggered by Velu’s investment in hospital chain Sri Kauvery Medical Care (Trichy) Ltd and Anand Diagnostic Laboratory Services Ltd, which directly competes with Metropolis Healthcare in some markets.
Carlyle has also reportedly alleged that Velu had been intending to damage the operations of Metropolis by soliciting its customers, potential joint ventures and employees.
Velu had been associated with Metropolis since 1998 as a co-promoter. However, reports of a boardroom battle between the Shah family of Metropolis and Velu spilled over at a time when the company was looking for a new investor.
The trigger to the fallout between the two promoters was the Shah family’s decision to acquire a 27% stake owned by PE firm Warburg Pincus Llc for Rs 550 crore, with the backing of KKR India, the local arm of global PE firm KKR & Co LP.
Warburg had invested $85 million in the firm in 2010, and was looking to exit its investment in Metropolis. The 2015 move by the Shahs saw the family’s stake increase from 36% to 63%.
In response to the Shahs acquiring a majority stake in the company, Velu did not mince on his words. “As a co-founder and co-promoter, I was deeply hurt. This transaction was put through without my knowledge,” he was reported to have said in a news report by The Economic Times in April 2015.
Eventually, Carlyle had bought out Velu’s stake, leading to his exit.
Velu runs his own company Trivitron Healthcare Pvt Ltd, which he founded in 1997. Last year he had launched two funds with a total corpus of $175 million to invest in healthcare delivery, consumer and enterprise technology segments.
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