TPG Growth buys majority stake in Cancer Treatment Services

TPG Growth, the mid-market and growth-equity investment platform of leveraged-buyout group TPG, said on Wednesday it has bought a majority stake in India- and South Asia-focused cancer treatment provider Cancer Treatment Services International.

The investment firm didn’t disclose financial details of the deal but said in a statement it will bring in Lloyd Nazareth, who has about 20 years of experience in India’s healthcare sector, as the group CEO of Cancer Treatment Services. Nazareth has previously worked with hospital chains Fortis Hospitals and Wockhardt Hospitals.

The investment firm picked up a 65% stake in the US healthcare company for $33 million (Rs 219 crore), according to a statement. The deal will help the cancer treatment service provider expand to 15 centres in India from two now. The Economic Times first reported the deal citing TPG executives.

The US healthcare firm's flagship international centre, American Oncology Institute, is in Hyderabad. The cancer-focused multispecialty hospital was founded in 2013. It offers radiation oncology, medical oncology, surgical oncology, full-service diagnostics and various support services.

The oncology market in India is growing at 20% annually and is forecast to touch Rs 3,831 crore by 2017, according to a study by Frost & Sullivan.

“Cancer has become a leading healthcare issue in India, and the disease is expected to rise five-fold by 2025. We see tremendous growth opportunity in the cancer care platform Cancer Treatment Services International has built thus far,” said Vishal Bali, senior healthcare advisor for TPG Growth in Asia.

In the oncology segment, HealthCare Global Enterprises Ltd (HCG) recently made its stock market debut. Although the listing failed to enthuse investors, analysts believe that HCG stocks will find takers going forward as oncology is a capital-intensive segment that requires a longer gestation period for the facilities to turn a profit.

TPG Growth has previously invested in companies across the tech, retail and entertainment sectors, including Uber, Airbnb, e.l.f. Cosmetics, Angie's Artisan Treats, Fender, SurveyMonkey and Red Book Connect. It has offices in the US, China, India, Turkey, London and Singapore.

In December 2015, TPG Growth acquired a 28 per cent stake in Sri Lanka’s Asiri Hospital Holdings from private equity firm Actis Investment Holdings.

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