ASG acquires 2 eyecare hospitals, plans to buy 10 more in 6 months

INDIA —ASG Eye Hospitals, a chain of super-specialty eye hospitals in India has accomplished acquisitions of two eye care hospitals – Garg Ophthalmic Centre in Lucknow, Uttar Pradesh, and (*2*) in Ambala, Haryana.

Backed by private equity investors General Atlantic and Kedaara Capital, ASG stated it is in the process of conducting due diligence to purchase ten more eye hospitals over the next six months.

ASG did not reveal the financial details of the two acquisitions in Lucknow and Ambala.

The Jaipur, Rajasthan-based pan-India specialty eye chain is lining up around Rs 500 crore (US$60.6 million) to fund growth that will be a combination of organic and a string of acquisitions.

In an interview with Economic Times, Dr. Arun Singhvi, chairman and managing director of ASG stated the corporate plans to set up a community of more than 200 hospitals throughout the subsequent 36 months by means of a mixture of natural and inorganic.

“(Our) typical (ticket) size of (acquisition) would be north of 5 crore (US$0.6 million) EBITDA (earnings before interest taxes depreciation and amortization) to Rs 25-30 crore (US$3-3.6 million) Ebitda,” Singhvi stated.

Singhvi stated out Rs 1000 crore (US$121 million) capital allocation for growth, 50% will probably be for purchasing Vasan Eye Care, and 50% will probably be for each organic and string of acquisitions.

ASG has more than 50 specialty eye hospitals throughout 16 states in India, in addition to Uganda and Nepal.

Singhvi stated the corporate expects the completion of Vasan Eye Care acquisition within a month, which can add around 97 eye hospitals to the community, giving it a powerful presence in South India.

Lenders of Vasan Eye Care had accredited ASG’s Rs 520 crore (US$63 million) proposal to purchase the debt-ridden chain Vasan Eye Care below the chapter regulation.

ASG won the bid to acquire Vasan Eye earlier this year, a large eye care hospital chain in India to expand its footprint in South India.

In recent times, ASG Eye Hospitals raised Rs 1,500 crore (US$188 million) in funding from General Atlantic, Kedaara Capital, and other existing investors such as Foundation Holdings.

This investment marked one of the largest fundraise in the eyecare industry in India and also the largest private equity transaction in the single specialty healthcare after the Rs 1,050 crore raised by Dr. Agarwal’s Health Care Ltd, earlier in May.

The transaction paved the way for Investcorp, which made an investment in the company in 2017 while another existing investor, Foundation Holdings stays put.

To date, ASG Eye Hospital has raised US$251.9 million with its last funding round having come on July from a Secondary Market round.

As ASG seeks to expand its operations and geographical footprint, it faces competition from similar companies including Indiana University Health, Community Health Systems, Pacific Medical Centers, and Health Information Designs.

India’s eye care market is expected to grow at a CAGR of 7.3%, valuing it at US$2 billion by 2022, based on the increasing burden of eye diseases and moderate growth in technological advancements.

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