Private equity firm Toro Finserve LLP, has got Sebi’s nod to expand its existing $500 million fund to $900 million with a greenshoe allowance of up to $100 million, a senior company official said.
The fund that was launched in 2017 by investment and healthcare industry veteran Kapil Khandelwal was initially targeting a first close in April 2020. However, Khandelwal says, the pandemic induced lockdowns affected the dealmaking cycle and it was not able to complete any of its investments till date. “The need to invest in the healthcare segment is all the more pronounced post-pandemic and we have got commitments from our existing LPs to expand the fund size,” he said.
The fund will look to invest anywhere between $10-50 million in healthcare segments such as hospitals, day care surgery, assisted living, rehab centers, diagnostic labs among others.
“We will raise capital from large family offices, pension funds, hedge funds, fund of funds, ESG impact funds apart from large academic medical research centers and university endowment funds,” he added.
Khandelwal had launched his first fund, a $500 million India Healthcare Opportunities Fund (IHOF), in 2017. After getting an approval from Sebi in 2018, it started scouting for deals but was not able to consummate any.
It is now targeting a first close with $300 million by mid-2023.
“We are glad that most of our existing foreign institutional investors have been affirmative and are still long with our increased investment scope and continue to stay invested despite a black swarm event like Covid which disrupted and delayed the investments in hard assets which we were working pre-covid. Moreover, there is additional and/or increased commitments from these investors. We lost a few of the institutional investors during covid not due to the lack of investments opportunities but due to other technical reasons,” he said.
According to Khandelwal, post-covid and due to geo political developments, there are several opportunities and spaces that have suddenly opened up for strengthening India’s healthcare system which witnessed major short comings in the last two years. Our current estimates suggest that India will require more than $350 billion to build a robust healthcare delivery for all which is cheaper, better and faster.
