MedPlus raises $115 Mn debt fund, existing PE investors make exit

The promoter of MedPlus has raised around $115 million in debt financing from Goldman Sachs to buy out existing private equity investors.

Hyderabad-based MedPlus was founded by Madhukar Gangadi. The company's existing private equity investors are US-based Mount Kellett Capital Management LP, TVS Capital Funds Ltd, and Ajay Piramal’s India Venture Advisors Pvt. Ltd.

The three investors together hold a 69% stake in MedPlus, while founder and CEO Gangadi holds the rest.

After Apollo, MedPlus is the second largest pharmacy retail chain in India. The speculation of buy out the stakes came to light in August last year, when private equity funds General Atlantic and True North were in talks to jointly invest around $200 million in the firm.

Among the existing PE investors, Mount Kellett held 49% in MedPlus through its arm MKCP Direct Investments (Mauritius) IV Ltd, TVS Capital’s TVS Shriram Growth Fund I owned 10.59% and Piramal-led India Venture Trust Fund-I held 9.09%.

According to Mint report, the PE investors had been looking for an exit for quite some time. Madhukar Gangadi now owns around 90% stake in the company, which is also planning to go public in the next 12-18 months.

MedPlus has a footprint in more than 150 cities and claims to served 250000 customers on a daily basis through its 1400 pharmacy and general stores.

Besides the pharmacy chain, it also runs businesses such as diagnostics chain MedPlus Pathlabs, RiteCure, a distributor of medical and surgical supplies to hospitals, MedPlusMart.com, an online medical store, and MedPlusLens, an optical store. Most of them are co-located with the pharmaceuticals stores.

In November 2017, Pune-based online pharmacy MedsOnWay raised about Rs 4 crores ($600,000) from RPG Ventures, the venture capitalist wing of RPG Group. In October, online pharmacy marketplace Netmeds secured an investment of $14 million led by Tanncam, a Cambodian investment holding company, which was joined by Sistema Asia Fund.

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