Two years after selling his stake in pathology chain Metropolis Healthcare Ltd in an acrimonious battle, healthcare entrepreneur GSK Velu has re-entered the diagnostics sector with a new firm, a media report said.
The firm, Neuberg Diagnostics, has already acquired five labs for Rs 400 crore and is looking to invest another Rs 500 crore to expand its digital footprint, Velu told The Economic Times.
Veluâs previous experienceâhe had exited Metropolis Healthcare by selling his stake to private equity firm Carlyleâhasnât deterred him from a potential stake dilution in his new venture.
âWe have the option of either raising money through debt or through a private equity partner for our expansion in the future,â he said in the report.
Velu and Carlyle had also reportedlyÂ locked into a legal battle over a non-compete clause when he sold his Metropolis stake to the PE firm.
However, Velu told VCCircle in an email response that no legal issues were pending. âAs of today we have no legal battles with anyone including Carlyle on this issue as I started [the] pathology lab business after my non-compete period [ended] as per our agreements,â he said.
Veluâs new company seems different from Metropolis in two ways. The firm plans to have an advanced range of testing âusing in-vitro diagnostics techniques along with total lab automation and big data analytics toolsâ, the report said. It will also build a presence in the Middle East and South Africa, the report said.
Metropolis had exited South Africa last year due to lack of growth and regulatory hurdles and restructured its Middle East business.
Velu told the newspaper also that Neuberg will look to grow organically in certain markets such as Andhra Pradesh, Telangana, Kerala and Madhya Pradesh and that it will eye acquisition opportunities in Maharashtra.
Metropolis has also made a few small-sized acquisitions to grow its operations. In February, Metropolis acquired Gujarat-based Sanjeevani Pathology Laboratory to strengthen its presence in the western region. Its earlier acquisitions include Aminâs Pathology Laboratory Pvt. Ltd and Wellness Laboratories Ltd, according to VCCEdge, the data research arm of VCCircle.
The diagnostics sector has seen a lot of investor interest. Recent private equity transactions include Kedaara Capitalâs investment in Vijaya Diagnostics late last year. Thyrocare and Dr Lal PathLabs have gone public over the past two years while Metropolis is also reported to be looking to list on stock exchanges.
*This article has been updated to include a comment from GSK Velu.