Jubilant sells hospital business to Narayana Health

Jubilant First Trust Healthcare (JFTH), a wholly owned subsidiary of pharmaceutical and life sciences firm Jubilant Life Sciences Ltd, has sold its hospital business to Bangalore-based Narayana Health on a slump sale basis, as per a stock market disclosure. The deal amount remained undisclosed.

JFTH operates two hospitals in West Bengal named Kalpataru in Barasat and Rabindranath Thakur in Berhampore. The latter is a 50-bed low-cost hospital run under a public private-partnership model  with the state government. Together, these two units churned out revenues of Rs 20.4 crore with a net profit of Rs 7.8 crore for the year ended March 31, 2013.

This deal will enable Jubilant Life Sciences to focus on its core businesses in pharmaceuticals and life sciences.

“The acquisition of Jubilant First Trust Healthcare’s hospital business in West Bengal is part of our strategic growth plan for East India. We have plans to upgrade the facilities at Jubilant Kalpataru Hospital in Kolkata to offer tertiary level super-speciality care in four to six months" said A Raghuvanshi, vice chairman, MD and Group CEO, Narayana Health.

Anand Rathi Advisors acted as the investment banker on this deal.

Narayana Health, which operates a chain of multispecialty and super specialty hospitals in the country, started with a 300-bed hospital in 2001. It has 6,000 hospital beds across 17 hospitals in 13 locations. The company, founded by renowned cardiologist Devi Shetty, raised $100 million from JP Morgan and PineBridge Capital in 2008. The company plans to have 30,000 beds by 2020.

Jubilant Life Sciences manufactures and supplies APIs, generics, specialty pharmaceuticals and life science ingredients, apart from offering services in contract manufacturing and drug discovery and development. The firm counts amongst its shareholder names like General Atlantic.

In December 2010, the company, then known as Jubilant Organosys, demerged its agri & performance polymers business into an independent, listed company called Jubilant Industries Ltd. The demerged entity had a mirror shareholding pattern to begin with, but the promoters’ stake went up pursuant to a group restructuring that involved some privately held firms of the promoters.

That demerger left Jubilant Life Sciences as an integrated pharma and life sciences company. 

It is now in the process of a further restructuring where it will transfer its pharmaceutical business to a wholly-owned Singapore-based subsidiary and plans to list it overseas.

In the healthcare services space, Manipal Health Enterprises recently acquired Jaipur-based Soni Hospitals Pvt Ltd.

(Edited by Joby Puthuparampil Johnson)

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