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Tata Capital Growth Fund invests in diagnostics firm Aarthi Scans


According to a joint statement from the firms, Tata Capital Growth Fund is purchasing a minority share in Chennai-based diagnostics company Aarthi Scans Pvt. Ltd. According to a source close to the transaction, the deal is worth more than Rs 200 crore.

 

Last month, VCCircle revealed that Aarthi Scans was raising its first external funding. In a statement, V Govindarajan, chairman and managing director of Aarthi Scans, said, "This investment from Tata Capital validates our conviction in our business concept of offering high quality diagnostics services to the masses at a reasonable price."

Aarthi Scans was founded in 2000 and is now run by a family of radiologists, Prasanna Vignesh, Aarthi Prasanna, and Arunkumar Govindarajan. It operates a network of over 45 diagnostic centres and over 100 collecting centres in ten states, including Tamil Nadu, Karnataka, Telangana, Maharashtra, Delhi-NCR, Pondicherry, Kerala, and West Bengal. According to the statement, the corporation wants to double its network by growing in existing cities and entering new large metros.



"We enjoy Aarthi Scans and Labs because of its more ethical approach, which results in better customer alignment. "We believe Aarthi is set to become a leader in the market, with great execution capabilities and exceptional promoters," stated Akhil Awasthi, managing partner, Tata Capital Growth Fund. Tata Capital Growth Fund is a $240 million (about 1,700 crore) private equity fund managed by Tata Capital, the Tata group's finance arm. The fund seeks to invest in firms that generate a significant amount of their revenue from operations in India. Aarthi Scans had Veda Corporate Advisors as her sole financial advisor.

Private equity firms' pursuit of diagnostics assets demonstrates continuing investor interest in this domain in the country, particularly after the outbreak of the epidemic. A number of diagnostics companies in India have matured with considerable private equity capital over the years, and several have already gone public. In late 2015, Dr Lal PathLabs became the first diagnostics company to go public. Following suit were Thyrocare Technologies and Metropolis Healthcare. Krsnaa Diagnostics and Vijaya Diagnostics, two regional diagnostics companies backed by private equity, went public last year.



Last week, Motilal Oswal Private Equity (MOPE) announced that its fourth fund will invest up to Rs 194.4 crore (about $25 million) in Mankind Pharma's diagnostics business, Pathkind Labs. In late 2015, Dr Lal PathLabs became the first diagnostics company to go public. Following suit were Thyrocare Technologies and Metropolis Healthcare. Krsnaa Diagnostics and Vijaya Diagnostics, two regional diagnostics companies backed by private equity, went public last year. Last week, Motilal Oswal Private Equity (MOPE) announced that its fourth fund will invest up to Rs 194.4 crore (about $25 million) in Mankind Pharma's diagnostics business, Pathkind Labs.

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