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PE-backed dialysis chain NephroPlus acquires DaVita Care India
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Nephrocare Health Services Pvt. Ltd, which operates a chain of dialysis centres under the NephroPlus brand, has acquired DaVita Care India Pvt. Ltd in the latest sign of consolidation in a sector that has recorded private equity interest.

As part of the transaction, NephroPlus will acquire DaVita India's network of 22 centres. These centres will be rebranded to Neproplus in a month’s time, Vikram Vuppala, founder and CEO at NephroPlus, told VCCircle.

Vuppala declined to disclose the deal value, saying only that DaVita India's annual turnover is around Rs 50 crore.

According to VCCEdge, the data research arm of VCCircle, DaVita India posted net sales of Rs 29 crore for the year through March 2017, up from Rs 22 crore the year before. It posted a net loss of Rs 19.9 crore, compared with Rs 15 crore the year before.

US-based DaVita Inc had entered India by acquiring Bangalore-based renal care services provider NephroLife Care in 2012. Venture capital firm New Enterprise Associates had come in as an investor in the company.

NephroPlus

The company was founded by Vuppala, Sandeep Gudibanda and Kamal Shah in 2009. It has 154 dialysis centres in 92 cities across India. It plans to enter foreign markets in the next one year by opening centres in South Asia and the Middle East, said Vuppala.

NephroPlus had raised $4.25 million in a Series A round from Bessemer Venture Partners in 2011, followed by $10 million from International Finance Corporation, the World Bank’s private-sector arm, in June 2014.

In 2016, NephroPlus raised Rs 100 crore (nearly $15 million) from private equity firm SeaLink Capital Partners and IFC in a Series C round of fundraise.

NephroPlus registered revenue of Rs 150 crore for the year ended 31 March 2018 and aims to touch about Rs 200 crore in this fiscal, said Vuppala.

Deals in the space

This is the second acquisition in the dialysis segment, which had got a shot in the arm when the government said in the 2016 budget that funds for the National Dialysis Services Programme will be made available through the public-private-partnership mode under the National Health Mission.

In September 2016, Germany’s Fresenius Medical Care AG had bought an 85% stake in Indian dialysis services company Sandor Nephro Services Pvt. Ltd, which runs the Sparsh Nephrocare chain, from a group of investors including Tata Capital Healthcare Fund.

This year has so far seen two private equity deals in the segment.

Last month, RAHI Care Pvt. Ltd raised its first round of institutional funding from domestic private equity firm Neev Fund, which is backed by State Bank of India and the UK’s Department for International Development.

In July, the Asian Development Bank agreed to invest $10 million (Rs 68.7 crore) in DCDC Health Services Pvt. Ltd, which operates dialysis centres under the brand Deep Chand Dialysis Centre. The company had raised its first external funding of close to $5 million from the UK-based CDC Group-backed Pragati India Fund in December 2014.

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