“Have you been diagnosed with cancer?”

The much-rehearsed question finally tumbled out.  As callous and rude as it sounded even to my ears, it was essential to get this out of the way. The rest of the conversation, and hence the story, would follow from it. For a few months now, the Indian healthcare industry had been buzzing with stories of Dr Naresh Trehan, the founder of Medanta. Agog to hear why and how he is exiting the business he founded, both financially and operationally. And if that is because he is suffering from “some kind of malignancy”.

If my question was a gut punch to him, he didn’t show it. “No. Come, I’ll run a marathon with you.”

What about the exit?

Trehan and his family hold 36% in Medanta Hospital’s parent company, Global Health Private Limited (GHPL), which has large private equity investors like Carlyle and Temasek. Earlier this year, newspapers reported that Malaysian healthcare conglomerate IHH and existing investor Temasek wanted to acquire majority stakes in Medanta, valuing it upwards of Rs 5,500 crore (~$828 million).

“No, I haven’t done any deal. We are not in the market. We were in talks with IHH, operators like them are strategic partners. They made us an offer, and from there it got leaked. But we had nothing to do with that. Nobody asked us, they just published,” he said.

“I called a town hall [meeting],” he continued, “and told everyone that the deal is not done. But somebody started a WhatsApp trail saying we have sold out. It’s fake news. You guys are guilty of this, not me.”

“But your senior doctors, even today, don’t believe you. They say you’ve sealed the deal,” I countered in early August.

“Someone clearly doesn’t like me here, then,” he said wryly. Or as an industry insider said, “Someone doesn’t want his hospital valuations to be good, hence these rumours.”

Medicine is going to go through hard times...Even though I've been part of Ayushman Bharat, my concern is realistic pricing and a good, fair payment mechanism under this scheme.

Dr Naresh Trehan, Chairman, Medanta

Trehan says he isn’t looking for private investment anymore. He won’t say why the Medanta and IHH talks fell apart—which led the Malaysian company to buy out Fortis Healthcare this month—but admits IHH would have made a good strategic partner. Some investors say it was due to a valuation mismatch because while Medanta is a great asset, it’s not a chain of hospitals; the Gurugram hospital is nearing its peak performance. Almost the entire business is dependent on one hospital which, incidentally, saw a drop in its revenue and profits in FY17 for the first time in its 10-year history.


Seema Singh

Seema has over two decades of experience in journalism. Before starting The Ken, Seema wrote “Myth Breaker: Kiran Mazumdar-Shaw and the Story of Indian Biotech”, published by HarperCollins in May 2016. Prior to that, she was a senior editor and bureau chief for Bangalore with Forbes India, and before that she wrote for Mint. Seema has written for numerous international publications like IEEE-Spectrum, New Scientist, Cell and Newsweek. Seema is a Knight Science Journalism Fellow from the Massachusetts Institute of Technology and a MacArthur Foundation Research Grantee.

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