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ARCAPITA GAINS 60PC FROM INDIA INVESTMENT

MANAMA: Bahrain-based Islamic investment firm Arcapita exited its Indian healthcare investment in MedPlus Health Services with returns of more than 60 per cent over its own expectations, a top company official said yesterday.

Arcapita sold its stake in the Indian company to a consortium of private equity investors after becoming the largest shareholder in MedPlus in 2007 in a transaction valuing the company at $72 million.

The private equity firm maintains a positive outlook on India for investment opportunities, it said.

"Throughout India, we continue to see opportunities in each of our asset classes of private equity, real estate and infrastructure," chief executive officer Atif Abdulmalik said.

"We are investing further resources to develop our business there and to satisfy what we believe is growing investor demand for high-quality Indian investments."

Arcapita acquired its stake in MedPlus as part of its strategy to develop a private equity portfolio in the high-growth Indian market, and this is the first exit from that portfolio.

During the holding period, the number of stores grew by 350pc to 800, revenues grew five-fold and gross profit increased six-fold.

"During 2007, we began to source and develop private equity investments in India, adding further diversity to our investment portfolio, and offering our investors exposure to one of the fastest growing global economies.

"Generally, India has continued to grow steadily through the downturn, and we are pleased that this has been reflected in the performance of MedPlus since acquisition."

Since acquisition, the MedPlus brand has expanded its presence into five states in India and increased from 230 stores to 800 at exit, benefiting from innovative loyalty programmes and a private label product that has driven margin improvement across the business.

"We have worked closely with the management team to develop the scale of the business and to expand geographically, succeeding in simultaneously growing revenue and improving margins," said Ranjeev Bhatia, head of Arcapita's India and Middle East focused private equity group.



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