The US-headquartered Sutherland Global Services, a global provider of business process and technology management services with 25% of its workforce in India, has acquired Apollo Health Street (AHS), a company owned by Apollo Hospitals Group and a provider of healthcare business services and health information technology-based solutions, for an enterprise value of Rs 1,000 crore.
The transaction is expected to close by February 2013. It may be recalled that Apollo Hospitals is in the look out for buyers for over two years.
Apollo Health Street, which has an annual run rate of around $110 million, posted a revenue of R270 crore for the half-year ended September with an Ebitda margin of 18%, said A Krishnan, chief financial officer of Apollo Hospitals Group. It has an employee strength of around 3,200 people with 10 centres, including six in the US with 700 employees, said Sangita Reddy, managing director, Apollo Health Street. The company has 150 clients, mostly in the US, she added.
Apollo Hospitals, with its shareholding of close to 40% in AHS, will rake in around R225 crore out of this sale. The promoters, including Reddys and entities, hold another 13% in the company on individual basis. Major PEs such as One Equity Partners of JP Morgan, Schroder group of Europe and Temasek Holdings of Singapore hold around 20%, 7% and 10%, respectively, with the remaining being held by individual investors and employees, Sangita Reddy maintained.
“It is believed that nearly half-a-dozen companies were in race to acquire AHS, however, Sutherland was the natural choice because of its commendable network and workbase with rapid growth apart from the reason that it positioned itself strategically to acquire AHS,” said A Krishnan.
Speaking to the FE from the US, Dilip Vellodi, founder chairman & CEO of Sutherland Global Services, said: “AHS was found to be a right fit for us to scale up our operations, not only in the US but also expanding our base to Europe, Asia Pacific, West Asia and African countries. AHS has a good track record and happened to be a pure-play healthcare BPO player and was also operating out of the US. It has the good cost structure, delivery efficiency, strong back offiice platform and stable customer base.”
AHS also has a truly global leadership team with great analytics skills, which are important to track outcome of the analysis through data, Vellodi said.
“What is interesting in this acquisition is that it happened at