Apollo Hospitals to infuse Rs 250 cr into company

The promoters of Apollo Hospitals Enterprise Ltd (AHEL) plans to infuse Rs 250 crore to support the hospital’s proposed Rs 1,500 crore expansion. Meanwhile, the hospital chain has got an in-principle approval to rope in a partner for its BPO arm Apollo Health Street.

Speaking on the sidelines of signing an MoU with Apollo Endosurgery in Austin, Texas (USA), and Albert Einstein College of Medicine and Beth Israel Medical Center (New York) Prathap C Reddy, chairman, Apollo Hospitals Group, said, “we (promoters) will be infusing around Rs 250 crore in the next one year to support AHEL’s expansion plan”.

According to hospital’s presentation to the investors, by financial year 2014, Apollo is planning to invest Rs 1,290 crore to add 2,418 beds across metros, large cities and semi-urban and rural ares. Of the total investment AHEL’s would infuse around Rs 1,100 crore. It may be noted the hospital has raised around Rs 350 crore through qualified institutional placements (QIP) which is the first tranche of its Rs 900 crore QIP plan. The rest will be invested through debt and internal accruals, said Reddy.

Presently AHEL is one of the largest network in Asia with 5,842 owned and 2,875 being managed across 37 owned and 17 managed hospitals as on March 31, 2011.

Commenting on the company’s plan for its BPO arm ‘Apollo Health Street’, Reddy said, the company is planning to rope in a partner, who has competence in the health care technology domain. Reddy who claimed Apollo Health Street is the third largest BPO firm said “so far four companies have approached us, final call will be taken in the coming weeks.”

He declined to reveal the names of the companies.

Apollo Health Street is an associate company of Apollo Hospitals Enterprises, which acquired it from US-based BPO Zavata in 2005 for $170 million.

AHEL and the promoter’s family holds 49 per cent and five per cent respectively. The other investors include private equity funds including One Equity Partners and Temasek Holdings

The BPO arm operates in 13 locations, including four offices in India, with 3,000 people in India and 1,000 in United States. “It is profit making firm,” said Reddy.

AHEL is also planning to set up a medical college in Hyderabad with an investment of Rs 100 crore., said Reddy.