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Private Sector | Karnataka - India | PID: 202840
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Private equity firm, Advent International, will invest Rs 2,475 crore (USD 300 million) into Apollo HealthCo, a wholly-owned subsidiary of Apollo Hospitals Enterprise. Parallely, Keimed, a wholesale distribution company owned by the promoters of the Apollo Group, is to be merged with Apollo HealthCo.
Apollo HealthCo operates two businesses - digital healthcare (Apollo 24/7) and pharma distribution. Under ‘pharma distribution’, it serves 6,000-odd pharma outlets owned by Apollo Pharmad. The merger of Keimed with Apollo HealthCo will raise the number of pharmacies it serves to 70,000. Advent will invest in compulsorily convertible debentures of Apollo HealthCo in two tranches, Rs 1,732 crore (70 percent) at first close, and Rs 743 crore (30 percent) in 12 months. When converted into equity, Advent will end up with 12.1 percent stake in Apollo HealthCo.
The consideration of Rs 2,475 crore that Apollo HealthCo receives from Advent will be utilised in this way. Rs 860 crore will be used for further growth of the company; Rs 890 crore will be paid to the parent company, Apollo Hospitals Enterprise. Rs 725 crore will be used for buying 11.1 percent stake in Keimed for the integration. The other 88.9 percent (owned by existing shareholders of Keimed), will convert as equity in Apollo HealthCo.
After the merger, the Apollo Hospitals Enterprise will have ownership of 59.2 percent; existing shareholders of Keimed with 25.7 percent; Advent International 12.1 percent and ESPO three percent. Keimed will strengthen Apollo HealthCo’s own database and fuel the company’s data analytics. The deal is expected to double Apollo HealthCo’s turnover to Rs 25,000 crore in three years.
Under Apollo 24/7 platform, the company offers doctor consultation, home delivery of medicines, diagnostics at home, chronic condition management and insurance.
| Updated on: 04 - May - 2024
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