HealthCare Global Enterprises (HCG) rose 1.05% to Rs 255 after the company said it acquired majority stake in Suchirayu HealthCare Solutions in Hubli.
HCG announced the acquisition of an additional 60.9% in Suchirayu Healthcare Solutions, Hubli, thereby becoming a majority stake owner from its existing 17.7% to 78.6%.Suchirayu owns a multi-speciality hospital in Hubli with an operational capacity of 110 beds and a potential to scale up to 250 beds. HCG has operated and maintained the said entity's hospital since August 2017 and had the right to increase its stake up to 80% in July 2022.
HCG also owns and operates a standalone cancer centre at Hubli, and the acquisition is expected to create synergetic benefits and market leadership in the geography.
HCG and the current group of promoter doctors decided to bring HCG on board to collectively enhance the value moving forward. This acquisition will be in line with HCG's strategy going forward.
The revenue of Suchirayu for the financial year ended on 31 March 2021 was Rs 55.37 crore.
The acquisition has been completed on 18 November 2021. The company has acquired 3.30 crore shares of Suchirayu at Rs 10 per share, for an amount aggregating to Rs 33 crore. The consideration for the issuance of shares was paid in the form of cash.
Dr. BS Ajaikumar ('Dr. Ajai'), executive chairman of HCG, said, "HCG continues on its path to optimize capital allocations around Cancer Care and strengthen its pre-eminent position around the length and breadth of the country. M&A has been a core part of our strategy, and we have demonstrated our capability to integrate acquisitions. Having operated Suchirayu for the past four years with successful patient outcomes and desired financial results, acquiring a majority was a logical step in cementing our presence in the region. We are confident that we will be able to derive multiple synergies with this acquisition. Hubli is an emerging geography with great potential, and the acquisition will deliver focused medical care into this micro-market. We continue to explore opportunities in the regional cancer leaders' space to further consolidate our dominant position."
Bengaluru-based HCG is India's largest provider of cancer care. Through its network of 22 comprehensive cancer centers across India and Africa, HCG has brought advanced cancer care to the doorstep of millions of people. HCG's comprehensive cancer centers provide expertise and advanced technologies for the effective diagnosis and treatment of cancer under one roof. Under the "Milann" brand, HCG operates 7 fertility centers.
On a consolidated basis, HCG reported net profit of Rs 103.09 crore in Q2 September 2021 as against net loss of Rs 22.29 crore in Q2 September 2020. Net sales rose 42.29% to Rs 351.25 crore in Q2 September 2021 over Q2 September 2020.
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