KKR To Buy Indian Medical Devices Maker Healthium Medtech for $840 Mn

KKR (Kohlberg Kravis Roberts & Co.), a global investment firm, is set to acquire Healthium Medtech (formerly known as Sutures India) from its current private equity owners, Apax Partners, for an impressive ₹7,000 crore (approximately $840 million) in enterprise value.

Healthium Medtech is an Indian company based in Bengaluru. It specializes in manufacturing medical devices, particularly surgical products. Notably, it is the largest manufacturer of surgical needles globally by volume.

This acquisition follows a competitive bidding process that also involved a consortium of Mankind Pharma - ChrysCapital and Novo Holdings, the controlling shareholders of Danish drug major Novo Nordisk.

Earlier this year, Apax had initiated a formal sale process, and KKR emerged as the highest bidder for Healthium. Notably, in 2022, Healthium Medtech had already sold its UK- based subsidiary to KKR for an undisclosed amount. The transaction is being done at 20X the current EBITDA multiple of the current fiscal year, indicating the significant value of the deal. 

Healthium Medtech's revenue for the financial year 2023- 24 was ₹820 crore, with an EBITDA of ₹256 crore. For the current financial year, revenue is expected to reach ₹1,020 crore, with EBITDA around ₹350 crore.

Healthium Medtech was originally established in 1992 in Bengaluru by LG Chandrasekhar and S Subramanium, former executives with Smith & Nephew and Johnson & Johnson.

Earlier in 2022, Healthium Medtech had sold its UK-based subsidiary to KKR for an undisclosed amount.

Market Landscape

Healthium holds about 18% market share in India and is the fourth-largest surgical suture manufacturer in the world. Under KKR ownership, Anish Bafna, the current CEO and MD of Healthium Medtech, will continue to lead the company.

Ethicon Inc., a subsidiary of Johnson & Johnson, currently holds the market leadership position in surgical sutures. Other players in the global surgical sutures market include Arthrex Inc and Covidien Holding Inc.

This acquisition reflects KKR's strategic move to strengthen its presence in the healthcare sector, particularly in the medical devices industry. Healthium Medtech's expertise and market position make it an attractive investment for KKR.

Recent Acquisitions by KKR

KKR has been quite active in the acquisition space. Here are some of their recent acquisitions:

• SunFire (May 2024): KKR acquired SunFire, a company operating in the distribution sector.
• Avantus (April 2024): KKR made an acquisition of Avantus, which likely falls within the enterprise software domain
• mdf commerce (April 2024): KKR's acquisition of mdf commerce further expands its portfolio. mdf commerce is likely involved in technology or e-commerce.

These acquisitions demonstrate KKR's strategic moves to diversify its investment portfolio across various sectors. Keep in mind that KKR's investment landscape is dynamic, and they may continue to explore new opportunities in the market.

US-based KKR Increases Stake in Reliance Retail By Investing Additional ₹2,069.50 Cr

Reliance Retail Ventures Limited (“RRVL”) announced today that global investment firm KKR & Co Inc ("KKR"), through an affiliate, will invest ₹ 2,069.50 crore ( ~ approx $250 million) into RRVL, a subsidiary of Reliance Industries Limited. This investment values RRVL at a pre-money equity value of ₹ 8.361 lakh crore, which makes it among the top four companies by equity value in the country.

This comes within weeks after RRVL raised funds amounting ₹ 8,278 crore (approx. US $1 billion) from Qatar's sovereign wealth fund, Qatar Investment Authority (QIA).

KKR’s follow-on investment will translate into an additional equity stake of 0.25% in RRVL on a fully-diluted basis.

This, combined with its stake from its investment of ₹ 5,550 crore in RRVL in 2020, will take its total equity stake in RRVL to 1.42% on a fully-diluted basis. In 2020, RRVL raised an aggregate amount of ₹ 47,265 (US $5.71 billion) from various global investors, at a pre-money equity value of ₹ 4.21 lakh crore ($52 billion).

RRVL, through its subsidiaries and associates, operates India's largest, fastest growing, and most profitable retail business serving 267 million loyalty customers with an integrated omnichannel network of over 18,500 stores and digital commerce platforms across grocery, consumer electronics, fashion & lifestyle, and pharma consumption baskets.

RRVL’s vision is to galvanize the Indian retail sector through an inclusive strategy serving millions of customers, empowering micro, small and medium enterprises (MSMEs) and working closely with global and domestic companies as a preferred partner, to deliver immense benefits to Indian society, while protecting and generating employment for millions of Indians. RRVL, through its New Commerce business, has digitized more than 3 million small and unorganised merchants. This will enable these merchants to use technology tools and an efficient supply chain infrastructure to deliver a superior value proposition to their own customers.

Founded in 1976, KKR has approximately $519 billion in assets under management (AUM) as of June 30, 2023. KKR has a long history of building leading global enterprises that are at the forefront of technology and digital transformation, including in the areas of consumer retail and eCommerce, as well as a track record of supporting leading corporations in India.

KKR’s follow-on investment in RRVL furthers its relationship with Reliance Industries Limited. In addition to its investment in RRVL, KKR is also an investor in Jio Platforms Limited, a leading digital services platform and a subsidiary of Reliance Industries Limited.

Reliance is India’s largest private sector company, with a consolidated revenue of INR 9,74,864 crore (US$118.6 billion), cash profit INR 1,25,951 crore (US$ 15.3 billion) and net profit of INR 73,670 crore (US$9.0 billion) for the year ended March 31, 2023. Reliance’s activities span hydrocarbon exploration and production, petroleum refining and marketing, petrochemicals, advanced materials and composites, renewables (solar and hydrogen), retail and digital services.

Currently ranking 88th, Reliance is the largest private sector company from India to feature in Fortune’s Global 500 list of “World’s Largest Companies” for 2023. The company stands 45th in the Forbes Global 2000 rankings of “World’s Largest Public Companies” for 2023 - top-most among Indian companies. Reliance has been ranked among the world's 20 best companies to work with, highest amongst Indian companies in Forbes’ World's Best Employers for 2022.

Biz Planning Software Firm o9 Solutions Raises $100 Mn from KKR, Plans to Ramp Up Hiring in India

Integrated business planning software firm o9 Solutions on Wednesday said it has raised USD 100 million (around Rs 761 crore) from global investment firm KKR.

KKR has picked up a minority stake in o9 Solutions, valuing it over USD 1 billion.

The company intends to hire India-based talent in emerging technologies like artificial intelligence, machine learning and other key technologies in the digital transformation space as well as expand its customer base in Asia, it said in a statement.

o9's platform is powering the planning and operations for large enterprise clients across industry verticals, including retail, consumer goods, apparel, consumer electronics, industrial manufacturing, and oil and gas.

o9 was set up by Sanjiv Sidhu and Chakri Gottemukkala, both Indian Americans originally from Hyderabad.

"The funding from KKR is enabling us to accelerate growth across global markets, including India. India is also the place where we hire world-class development and consulting talent. In the last year, our India team grew by close to 100 per cent," o9 Solutions co-founder and CEO Chakri Gottemukkala said.

The company has onboarded about 100 new people even in the midst of the COVID-19 pandemic and will continue to hire both experienced professionals, and freshers from IITs, IIMs and other premier institutions, Gottemukkala added.

Jake Heller, co-head of KKR's Technology Growth team in the Americas, said digitisation and the rapid advancement of economies in Asia are secular growth themes that KKR has been focused on.

"Sanjiv and Chakri are industry pioneers who have built a best-in-class team and technology platform for digitally transforming how supply chains and operations are managed. We are thrilled to be the first external investor in o9 and to provide the support of our global platform as the team continues to accelerate their growth in Asia," Heller said.

o9 has over 500 employees globally, of which more than 350 are based in India. Its clients in India include different divisions of Aditya Birla group, Tata Group and leading paint companies.PTI SR

Jagatjit Industries Bags Funding from KKR to Support the Company’s Ongoing Restructuring Efforts

Leading Indian Made Foreign Liquor (“IMFL”) company Jagatjit Industries Limited has received funding from leading global investment firm KKR to support the company’s ongoing restructuring efforts.

Jagatjit Industries will use the proceeds to build the brand appeal of The Company's liquor portfolio - spanning whisky, rum, gin and vodka products across premium labels including Aristocrat – streamline its portfolio, increase manufacturing capacity, strengthen the management team, and expand its distribution reach.

Roshini Sanah Jaiswal, Promoter & Chief Restructuring Officer (CRO) of Jagatjit Industries, said, "Receiving the support of a global investor such as KKR validates Jagatjit Industries’ growth, market potential and the opportunities stemming from our restructuring efforts.  It is also a belief in the strength of our iconic brand – Aristocrat.

“We will use these funds as growth capital to take the group to the next level. The funds will support Jagatjit Industries’ restructuring and modernization efforts,” she added.

Jagatjit Industries has been undergoing a massive restructuring under Ms. Jaiswal, who joined the company in November 2014. Since her appointment, Jagatjit Industries has announced several additions to its leadership team across key divisions such as Human Resources, Purchase, Supply Chain Management and Sales.

As part of the restructure, Jagatjit Industries also bought in international packaging house Sedley Place UK to refresh the packaging for its popular whisky brand AC Black and ACP. In addition, The Company worked with the Inver House Distillers from Scotland to improve the blends.

Sanjay Nayar, CEO of KKR India, said, “KKR aims to provide financial solutions to strong partners in India like Jagatjit Industries. We have been impressed with the momentum, focus and execution capabilities of the Jagatjit Industries team throughout the company’s restructuring process, and are pleased for the opportunity to contribute to the company’s ongoing growth and success.”

Jagatjit Industries is a household name in the IMFL sector with a particularly strong presence in Southern states of Andhra Pradesh and Kerala, in the East across Orissa, West Bengal and Jharkhand, and across India’s North and Northeastern states.

Set up in 1944, Jagatjit Industries Limited, is one of the largest IMFL companies with an inception dating back to when India got its independence. The company manufactures the entire range of alcoholic beverages i.e. Whisky, Rum, Gin, Vodka, Brandy & Bottled Scotch Whiskey. Internationally the company exports products to countries all over the world, such as UAE, Oman, Saudi Arabia, Bangladesh, Sri Lanka & Malaysia, U.K., Eastern European and African countries.

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