KKR-backed promoters holding firm raises stake in Apollo Hospitals for $14M

PCR Investments, the holding company for India’s largest healthcare services company Apollo Hospitals Enterprise Ltd, has increased its shareholding in the company by acquiring 1 million shares representing around 0.7 per cent stake via an open market transaction on NSE.

PCR Investments acquired these shares at an average price of Rs 876.67 a unit, valuing the transaction at around Rs 87.67 crore ($14 million).

The Reddys—the promoter family of Apollo Hospitals—held around 34.35 per cent stake in the company, of which 18.42 per cent stake was held by PCR Investments while the rest is with individual family members, as of September 30, 2013. With the latest deal, PCR’s holding has moved to 19.14 per cent while the promoter’s stake has pushed beyond 35 per cent.

Earlier in October, promoters of Apollo Hospitals raised Rs 550 crore or $89 million from private equity major Kohlberg Kravis Roberts and its affiliates through PCR Investments. The investment was in the form of a five-year callable security and will be used to repay promoters’ debt and build more hospitals.

KKR subscribed to the convertible debentures issued by PCR Investments with an option to convert these into equity shares of listed flagship Apollo Hospitals at the end of five years. The promoters of the company have the right to buy back these instruments at the end of two years.

With over 8,420 beds across 51 hospitals, 1,503 pharmacies, 92 primary care and diagnostic clinics and 100 telemedicine units across 10 countries, Apollo Hospitals is the largest healthcare services company in India and one of the top firms in the business in Asia. It counts amongst its shareholders Malaysian sovereign wealth fund Khazanah, which is the single-largest institutional shareholder of the firm. In the past, Apollo Hospitals has also raised funding from Apax Partners which recently exited its investment.

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