Four investment firms in talks for stake in Sutures

GIC, Temasek, Khazanah and Baring keen on India's largest manufacturer of surgical products

Four global investment firms, including GIC, Temasek Holdings and Malaysia's Khazanah Nasional, are reported to be in talks to buy a 20 per cent stake in surgical equipment maker Sutures India, worth an estimated four billion rupees (S$85.6 million).

The trio, along with Baring Private Equity Asia, are holding talks with India-focused private equity firm CX Partners, which aims to sell its 20 per cent stake in Sutures - a company valued at US$300 million (S$424 million), reports said.

US-based TPG Growth owns 52 per cent of Sutures, while the rest is held by its promoters.

Bangalore-based Sutures has emerged as India's largest manufacturer of surgical products like needles, tapes, bone wax, catheters and disposable gloves since its founding in 1992. Its products are exported to about 90 countries in Europe, South America, Africa and Asia, as well as more than 10,000 hospitals in India.

Bangalore-based Sutures has emerged as India's largest manufacturer of surgical products like needles, tapes, bone wax, catheters and disposable gloves since its founding in 1992. Its products are exported to about 90 countries in Europe, South America, Africa and Asia, as well as more than 10,000 hospitals in India.

The country's medical device industry is currently valued at US$4.4 billion, the fourth largest in Asia, and has the potential to grow to US$7 billion by 2016, with a growth rate of 10 to 15 per cent annually, according to the US-India Business Council.

"Medical devices manufactured in India have a strong cost advantage over imported devices, which makes these businesses attractive," Mr Dilip Dusija, of advisory firm BDO India, told LiveMint news portal.

GIC, the world's sixth-biggest state fund with an estimated US$315 billion worth of assets, has investments in 40 countries in private equity, real estate and fixed income, among others. It has been investing in emerging markets for over 20 years.

Earlier this year, it agreed to buy a stake in Rede D'Or Sao Luiz, Brazil's largest hospital chain, with 4,500 beds across more than 27 locations. The chain's value has surged in the past five years.

Temasek also has a presence in the healthcare sector, having invested in India's HealthCare Global Enterprises and multi-speciality hospital Medanta -The Medicity.

Khazanah holds a minority stake in Mumbai-based drug maker Ipca Laboratories, and also holds a stake in India's second-largest hospital chain operator Apollo Hospitals, LiveMint reported.

A version of this article appeared in the print edition of The Straits Times on November 24, 2015, with the headline 'Four investment firms in talks for stake in Sutures'. Print Edition | Subscribe