Advent's INR 3,150 crore for 24.87% of Yatharth Hospitals is priced at the regulatory floor and capped below the open-offer line. The terms that matter are in the Articles: vetoes with rupee thresholds, and an exit priced in dollars.
Yatharth Hospital & Trauma Care Services approved a preferential issue of shares and warrants to an Advent International vehicle on 17 September 2026: INR 3,150 crore for 24.87% on a fully diluted basis, priced at the SEBI floor. The restated Articles annexed to the EGM notice carry the full term set: a pre-emption cap at 24.99%, reserved matters with rupee thresholds, rights that fall away at 12.5% and 5%, warranty and indemnity insurance in place of company indemnities, a three-year promoter lock-in, an upside share for the promoter above 3x, and an exit through a promoter-run sale process whose price tests are measured in US dollars. A Gulf investor pricing a minority in an Indian hospital chain can check each of its own terms against this one.
What a board member needs before the next meeting on this.
- The price is the SEBI floor. Shares and warrants are priced at INR 985.17 against a floor of INR 984.70, about 0.05% above it on our arithmetic. There is no control premium because no control changes hands.
- Forty-four per cent of the cheque is deferred. INR 1,750 crore arrives at allotment on our arithmetic, and INR 1,400 crore only when the warrants are exercised. Upfront warrant money is forfeited if the warrants lapse.
- The design stays under the open-offer line. The investor's pre-emption top-up is capped at 24.99% and it may not buy in the market in a way that triggers an open offer without promoter consent. On our reading, that keeps it below SEBI's 25% trigger.
- The exit is a sale process, measured in dollars. There is no put. After five and a half years the promoters run a six-month sale process and can force a sale at a price that meets a 3.0x or 2.0x test calculated in US dollars.
On 17 September 2026 the board of Yatharth Hospital & Trauma Care Services, which runs nine multi-speciality hospitals with about 2,800 beds in North India (press release), approved a preferential issue of INR 3,150 crore for 24.87% of the company on a fully diluted basis (board outcome).
The investor, Rasmalai Limited of Cyprus, is majority-held by Advent International's GPE X funds (EGM notice). The size made the headlines. The terms are in the restated Articles annexed to the EGM notice, and they are the most complete public template for a foreign fund holding a large minority in a listed Indian hospital chain without control.
The price is the regulatory floor
Shares and warrants are both issued at INR 985.17, against a floor of INR 984.70 fixed under SEBI's preferential-issue rules with 15 September as the relevant date (board outcome). That is about 0.05% above the floor on our arithmetic.
The cash comes in two steps: INR 1,283.33 crore for 1,30,26,516 shares plus INR 466.67 crore of upfront warrant money at allotment, and INR 1,400 crore when the 1,89,47,664 warrants are exercised within their 15 or 18 month term (EGM notice). On our arithmetic, INR 1,750 crore arrives at allotment and 44% of the ticket is deferred. Upfront money on lapsed warrants is forfeited. The implied post-money equity value is about INR 12,666 crore on our arithmetic, new cash included.
24.87% sits just under the Takeover code
SEBI requires an open offer from anyone who acquires 25% or more of the voting rights in a listed company (Regulation 3(1), SEBI Takeover Regulations). The filings say only that control does not change and that the investor will be a public, non-promoter shareholder.
The Articles say more: the investor's pre-emption right on future issues can take it to 24.99% and no higher, and it may not buy in the market in a way that triggers an open offer without the promoters' consent (EGM notice). On our reading, the structure is built to stay below the open-offer line for the life of the investment. The Tyagi promoters fall from 55.80% to 41.82% on a fully diluted basis and remain the largest shareholder.
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The vetoes have rupee thresholds
Advent gets two non-executive board seats and a seat on each of the audit and the nomination and remuneration committees, while the promoters nominate the majority of non-independent directors (EGM notice). Its consent is needed for acquisitions beyond INR 400 crore in a financial year, capital expenditure above INR 300 crore a year, disposals above 5% of consolidated total assets and equity issuance beyond INR 500 crore over the life of the agreement.
The issuance veto falls away below 12.5% and the other rights below 5%. Because these are special rights under Regulation 31B of the Listing Regulations, public shareholders must re-approve them every five years.
The company stands behind few warranties
The company gives fundamental, tax and business warranties, but the investor has no recourse against it for business-warranty breaches covered by a warranty and indemnity policy the investor will buy before closing (board outcome). Fraud, breach of the interim covenants and certain customary matters stay with the company. The promoters accept a three-year lock-in from closing.
The exit is a sale process priced in dollars
There is no put. Between five and a half and six years after closing, the investor may ask the promoters to find a buyer. The promoters have six months, carry no liability if nobody appears, and may force the sale to a buyer whose offer clears the lower of a 3.0x money multiple on the whole stake or 2.0x on the shares sold, with both tests calculated in US dollars (EGM notice).
If no sale completes, the investor may sell up to 61% of its allotted shares to a competitor named in the agreement, without its governance rights. Ajay Tyagi, a promoter, takes an upside share on exit: nothing up to 3x, 33% of the incremental profit pool from 3x to 3.5x and 20% above 3.5x, settled in shares transferred at INR 1 each. Public shareholders vote on it under Regulation 26(6) and the promoters abstain.
The currency clause is the one to copy or resist
3x on INR 3,150 crore is INR 9,450 crore in rupee terms on our arithmetic. Because the exit tests run in dollars, any fall in the rupee over six years raises the rupee price a buyer must pay before the promoters can force a sale. For an investor whose own base currency is tied to the dollar, the rupee risk now sits inside the exit mechanics.
Four questions before signing a minority stake in a listed Indian hospital
- How far above the SEBI floor price are we paying, and what are we getting for any premium when no control changes hands?
- At what shareholding do our reserved matters fall away, and are the rupee thresholds set against the company's current capital expenditure plan?
- Is our exit a put, a facilitated sale or nothing, and in which currency are the return tests that govern it calculated?
- Which warranties does the company stand behind, and which sit only with a warranty and indemnity insurer?
The deal still needs special resolutions at the EGM on 15 October 2026, approval from the Competition Commission of India and in-principle approval from both exchanges, with allotment due within 15 days of the last (EGM notice).
If you are negotiating a minority in an Indian hospital chain this quarter, put your term sheet next to this one line by line: premium over floor, deferred share, veto thresholds, fall-away levels, indemnity route, exit mechanism and the currency of every return test. That is the negotiation our transactions and capital practice runs.
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