Bangalore-based Healthcare Global Enterprises Ltd (HCG) has agreed to purchase a majority stake in a cancer-care centre in Kenya in its first overseas acquisition.
HCG will buy a 93.66% stake in Nairobi-based Cancer Care Kenya Ltd for 93.15 million Kenyan shillings (about $905,000) in cash, the Indian company said in a stock-exchange filing. HCG will acquire the stake through step-down subsidiary HealthCare Global (Kenya) Pvt Ltd.
HCG added that it has also signed a pact with Nairobi-based MP Shah Hospital and Cancer Care Kenya’s promoters to subscribe to shares of the target company. After this pact is concluded, HCG will have a 77.5% stake in Cancer Care Kenya while MP Shah Hospital will have 10%. The target company’s promoters will have the remaining 12.5% stake.
“We expect to bridge the demand-supply gap existing in the cancer care space in Kenya, where patients have to travel out of the country for availing cancer care services due to inadequate treatment facilities in Kenya,” HCG said.
The transaction is subject to approval from the Competition Authority of Kenya and is likely to be completed by the end of June, the company said.
This is the first major takeover deal by HCG in more than three years. In 2013, HCG had acquired a 50% stake in Bengaluru-based fertility care provider Bangalore Assisted Conception Centre Pvt Ltd.
HCG is backed by PremjiInvest, the investment arm of Wipro Ltd chairman Azim Premji, and World Bank arm International Finance Corporation. Earlier this month, PremjiInvest sold a 2.54% stake in the company.
HCG, which has 17 cancer treatment centres across India, made its stock market debut exactly one year ago on a rather disappointing note with its shares plunging 21.6% at the end of first day’s trade.
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