Apollo Hospitals' board panel to review Lanka offer

In the wake of a buy out proposal for its Sri Lankan venture, leading hospital chain Apollo Hospitals today said it was reviewing the "critical" situation to take a suitable decision.

"We have set up a board committee to review the situation, and have also asked our merchant bankers to advise us on the issue. They have not given us the report," Suneeta Reddy, finance director of Apollo Hospitals, told PTI from Chennai.

Asked if Apollo would consider exiting from the venture in the island nation after Sri Lanka Insurance Corp (SLIC) offered to acquire the shares held by it, she said: "It is a critical situation now and any decision we take would depend on what our merchant bankers advise us and what the board committee thinks fit."

Reddy admitted that business environment or otherwise was not necessarily right in the country. "It is not a peaceful country and it has been like that for some time".

The Chennai-based Apollo Group holds 33% stake in its Sri Lankan venture - Apollo Hospitals Colombo (AHC) - with 4% being held by the promoter family.

SLIC, Sri Lanka's biggest insurance company, had recently upped its stake in AHC to 36.1% and made an offer to acquire the balance shares of the Indian healthcare specialist. It is offering Rs 28 per share for the remaining 63.9% shares.

Under Sri Lanka's securities laws, a shareholder who owns 30% or more in a quoted company must make a mandatory offer to other shareholders within a month of their purchase.