Fortis, India's biggest listed healthcare provider, has sealed a deal to buy 10 hospitals from Wockhardt , ending months of negotiations.
The move will give it a larger pan-India presence and help it reach out to the southern part of India, where Fortis is absent.
Well, its the largest ever deal so far in the Indian healthcare space. Fortis has acquired the cream of rival Wockhardt Hospital chain's assets, 8 running hospitals and 2 green field projects, for Rs 909 rupees. This includes Rs 190 towards capital work in progress for projects under construction.
This will provide Fortis with a mix of big and small hospitals, including 2 multi specialty hospitals and the top management of Wockhardt Hospitals including its CEO Vishal Bali will also move to Fortis fold.
Many feel that Fortis has driven through a hard bargain and according to analysts, the cost of setting up a greenfield hospital works out to approximately Rs 60 lakh per bed.
Fortis, as part of the deal, is paying just close to 50 lakh per bed for a largely up and running operation.
While it may not be positive for the listed Wockhardt Ltd and its shareholders in a direct fashion, many hope that it will free up the under pressure Khorakiwala promoters to focus on other businesses, especially domestic formulations.
Meanwhile, the stocks of both the hospitals moved up on Monday, indicating that Fortis shareholders were pleased with the value it was paying for Wockhardt and Wockhardt shareholders were hopeful that it would plough some cash back into the company.
The move will give it a larger pan-India presence and help it reach out to the southern part of India, where Fortis is absent.
Well, its the largest ever deal so far in the Indian healthcare space. Fortis has acquired the cream of rival Wockhardt Hospital chain's assets, 8 running hospitals and 2 green field projects, for Rs 909 rupees. This includes Rs 190 towards capital work in progress for projects under construction.
This will provide Fortis with a mix of big and small hospitals, including 2 multi specialty hospitals and the top management of Wockhardt Hospitals including its CEO Vishal Bali will also move to Fortis fold.
Many feel that Fortis has driven through a hard bargain and according to analysts, the cost of setting up a greenfield hospital works out to approximately Rs 60 lakh per bed.
Fortis, as part of the deal, is paying just close to 50 lakh per bed for a largely up and running operation.
While it may not be positive for the listed Wockhardt Ltd and its shareholders in a direct fashion, many hope that it will free up the under pressure Khorakiwala promoters to focus on other businesses, especially domestic formulations.
Meanwhile, the stocks of both the hospitals moved up on Monday, indicating that Fortis shareholders were pleased with the value it was paying for Wockhardt and Wockhardt shareholders were hopeful that it would plough some cash back into the company.
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