The Apollo Hospitals Group will tie up with two private-equity players to bid for Capio Healthcare, the UK’s fourth-largest independent healthcare provider, chairman Dr Pratap C Reddy told DNA Money on Tuesday without disclosing the names of the companies.
The biding for Capio, which is valued in the range of $2.36 billion, is set to open in August.
Besides American PE giant Blackstone, others said to be in the running for Capio include property mogul Nick Leslau, who has been joined by the Scottish banking group HBOS and Scottish entrepreneur Sir Tom Hunter.
Meanwhile, the Hyderabad-based healthcare chain has dropped out of the race for another UK firm — Priory Healthcare — which is on the block. “We did not find Priory good enough and dropped out of the race,” Reddy told DNA Money.
Talking of Capio, Dr Reddy said he was not interested in the real estate part of the offer and would bid for the healthcare component alone — which would be worth around $439 million.
Meanwhile Apollo Health Street (AHS), the BPO arm of the Apollo Hospitals Group, too, has hit the acquisition path and is closer to a $180 million takeover of an American healthcare BPO services firm. “We are in the final stages and hope to close the deal by July,” Sangita Reddy, executive director, Apollo Hospitals, said.
She refused to divulge the name of the US company. This deal is being financed through a combination of private equity funding and debt. This will be the second acquisition by AHS, which acquired US-based Armanti Financial Services (AFS) in a $31 million deal last year.
Armanti is one of the largest hospital billing and receivable management companies in the US. With the $2 trillion US healthcare sector expected to spend nearly $380 billion on back office operations alone AHS is looking to leverage its acquisitions for a huge chunk of this business.
While the Armanti acquisition helped it to reach $45 million in revenues in FY 06-07, it is looking to log over $100 million over the next 12-18 months through the new acquisition that will be finalised in July, she added.
Source : DNA India