Sabre Capital to boost healthcare fund size

The Indian private equity firm is raising an additional INR1.5bn for its healthcare-focused fund, which will increase its fund size to INR4bn.

Sabre Capital, a Mumbai-based private equity firm, has re-launched fundraising for Spring Healthcare, a fund which initially targeted commitments of INR2.5 billion ($52 million; €35.2 million) and saw a final close in August.

Given the strong response from investors and the need for capital in this sector in India, Sabre has decided to raise another INR1.5 billion for its healthcare fund, Rajiv Maliwal, managing partner at Sabre and chairman of the fund’s investment committee, told PEI Asia in an interview.

The firm now expects to see a final close on its healthcare fund in about six months, Maliwal added.

He said that Sabre has had a good response from investors and it is a sector where a lot of people want to make a commitment. “It is pretty much a virgin sector in India, where a lot of opportunities exist,” he added.

Maliwal said that India’s healthcare needs are huge and as insurance penetration is increasing in the country, the ability to pay more for healthcare services is increasing as well. Furthermore, he added, India is increasingly becoming a destination for patients from overseas.

The country also has the soft skills, particularly with respect to the calibre of its doctors. What the country needs is good, hard assets and the ability to run these hospitals, manage them and scale them up, according to Maliwal.

“Looking at the opportunity, we’ve had some very good response from investors. That’s why we’ve increased the size of the fund,” he said.

The fund has made one investment thus far. Maliwal said the fund has a broad investment strategy and it will make growth capital investments in brownfield projects for their expansion and will also target greenfield opportunities for acquisitions, but with the intent of growing the companies.

The fund will only target investments in mid-sized facilities and will also invest in clinical research.

This is Sabre Capital’s third fund. Its first, Sabre Capital, was a “pledged” fund whereby it raised capital from investors after spotting investment opportunities. The firm invested more than $400 million through Sabre Capital.

In 2008, the firm closed the Sabre-Abraaj Fund on $100 million. The fund which was raised in partnership with Dubai-based Abraaj Capital, is focused on infrastructure opportunities in India and is fully invested.