Nova Specialty Hospital’s existing centres will serve as new centres under the Apollo brand name
M Neelam Kachhap
Apollo Health and Lifestyle Limited (AHLL), a wholly owned subsidiary of the Apollo Hospitals Group, announced the successful acquisition of Nova Specialty Hospitals. This acquisition fits into the growth strategy of AHLL, providing a larger footprint, including in some markets where the company has no presence currently, while benefitting from Nova’s existing infrastructure and manpower.
Commenting on this strategic move, Sangita Reddy, Joint MD – Apollo Hospital Enterprises said, “The acquisition will enable AHLL to significantly expand its footprint and will catapult it into a leadership position in this segment of healthcare. These short stay centres will provide patients with convenience, proximity, safety and quality healthcare.”
She indicated that the earlier dispute with the Nova leadership (Dr Mahesh Reddy) has been resolved amicability and Dr Reddy will be a part of the new entity. However Suresh Soni, Chairman, Nova Medical Centers was conspicuous by his absence at the press meet called to announce the deal. In December 2014, Dr Reddy had approached the Company Law Board to stop Nova’s majority shareholders from executing a deal to sell the surgical unit to Apollo Hospitals.
“Nova is a good asset and we are happy with this acquisition,” Sangita Reddy said. She said AHLL was confident of turning around the company and break-even within 18 months. The deal is said to be valued in the range of Rs 135 -145 crores, subject to final closure. The combined network will clock a turnover between Rs 115 – 125 crores for the year ending Mar’ 15.
Nova Specialty Hospital’s existing centres (11 short stay surgery centres) will serve as new centres under the Apollo brand name. “This acquisition will also mark the entry of Apollo in new markets such as Mumbai, Jaipur and Kanpur. In the coming months, Apollo will relaunch these centres with new branding, an expanded menu of services and quality systems built on Apollo’s deep expertise in the hospitals space,” said Sangita Reddy.
In addition, AHLL will strengthen the service offerings in these centres by introducing Apollo’s preventive health checks and also establishing Sugar Clinics. AHLL is aiming to create a business of Rs 500 crores in five years in the space of multi-specialty short stay/day surgery centres,” said Neeraj Garg, CEO, AHLL.
Talking about the new entity Apollo Diagnostics, Garg said, “We are not going to acquire an existing diagnostic chain based in Mumbai. AHLL has been in diagnostics for more than 10 years and we will use the organic pathway to grow the business.” At present AHLL operates 4 reference labs in Bangalore. Chennai, Hyderabad and Pune. Garg said AHLL will focus on South and East India to grow the diagnostics business.
AHLL, headquartered in Hyderabad, has established the nation’s largest network of standardised day-to-day healthcare facilities branded ‘Apollo Clinic’ with close to 100 facilities operational across India and the Middle East. AHLL has also expanded its primary care offering with the launch of Apollo Sugar Clinics, which are integrated diabetes disease management clinics. It will also be launching a national diagnostics chain in the next few months. AHLL also operates a network of women and children hospitals – Apollo Cradle. It also runs a chain of centres focused on day surgery/short stay for planned surgeries.