Foreign Private Equity (PE) firms have increasingly chosen to invest in Indian healthcare. These firms investing in Indian healthcare are geared towards profit maximization and consequently value creation for their shareholders. While the focus on shareholder value creation can drive efficiencies in hospital management practices and create thriving businesses, there are concerns whether these benefits will extend to other stakeholders including patients, staff in the acquired hospitals, etc. A hospital getting acquired by a foreign PE firm will necessarily involve the interaction of two different organisational cultures. Hence, conflicts between the organizational cultures also pose a significant challenge post investment.

This project aims at a comparative study of hospitals that have been acquired and those which have not been acquired. Interaction with these diverse sets of hospitals will help in understanding the acquisition process through the foreign PE route and the consequences of such acquisitions. Gaining a deeper understanding of the views and experiences of these hospitals will help all the stakeholders of healthcare delivery including hospital management and staff, patients, foreign PE firms, to grasp the implications of such acquisitions, and prepare for the post-acquisition journey.    

The keynote here is the to study the implications of the nascent trends in foreign PE investments in Indian healthcare. This study employs both the primary and secondary data. While a poorly executed roll-out of the strategy for foreign PE investments in Indian healthcare could have adverse unintended consequences for the country, yet there are many overseas PE firms to acquire major healthcare chains in India, which can greatly benefit from a better understanding of this phenomenon. Hence the topic to be studied is vital from the healthcare industry as well as a public policy perspective.    

Tags: Private equity, healthcare