Fortis to sell Vadapalani hospital operations to Sri Kauvery Medical Care

Fortis Healthcare Limited, on Thursday, signing of definitive agreements for the sale of its hospital business operations at Vadapalani, Chennai to Sri Kauvery Medical Care (India) Limited, for a sale consideration of Rs 152 crore.

“The divestment of Arcot Road hospital business operations is in line with our stated intent of optimising our hospital assets keeping in mind our key markets and regions,” said Dr. Ashustosh Raghuvanshi, managing director & CEO, Fortis Healthcare Limited.  

“This also underpins our focus on improving our overall profitability and margins in the segment, allowing us to re-allocate capital in our key clusters,” he added.

 

Shares of Fortis Healthcare, on Thursday, fell marginally lower at Rs 308.85 on BSE.

In a regulatory filing, the company said, “The transaction will be an all-cash deal and is estimated to be consummated by the end of July 2023, subject to certain conditions as stipulated in the definitive agreements.”

The facility, which is on leased premises, was commissioned in October 2020 and is located on the arterial Arcot Road. It currently has 110 operational beds with a potential to scale up to nearly 200 beds, the company said in a statement.

The aforesaid divestment is a part of Fortis’ ongoing portfolio rationalisation strategy in order to focus on deepening its presence in select geographic clusters where it has a sizeable presence.

The acquisition of Vadapalani facility is in line with Kauvery’s strategy to further expand its presence in Chennai, in addition to its existing facilities of 500+ beds at Alwarpet & Radial Road.

Dr. S Chandrakumar, founder & executive chairman of Kauvery Group of Hospitals said, “We are focused on our growth plan to become a leading and trusted healthcare provider in South India. With this acquisition, we will have 750+ beds in Chennai.”

Dr. S Manivannan, founder & managing director of Kauvery Group of Hospitals said, “Kauvery continues to provide best-in-class personalised care, with the highest standards of clinical excellence and ethical practices. This acquisition helps us to expand our care to more regions in Chennai.”