Kavery Medical buys 34% stake in Seahorse Hospitals

Written by Economy Bureau | Chennai, Feb 11 | Updated: Feb 12 2008, 05:57am hrs
The Trichy-based Kavery Medical Centre & Hospital, a 225-bed hospital group, has acquired close to 34% stake in Seahorse Hospitals Ltd from the promoters of Seahorse group. The company will be making an open offer for 20% more soon, said S Chandra Kumar, managing director, KMC. Seahorse Hospitals is also situated in Trichy.

Addressing a press conference here on Monday, Kumar said Seahorse Hospitals is a listed company but was suspended from trading due to poor financial health a few years back. With the acquisition of Seahorse Hospitals, the total bed size of KMC will go upto 400 from the existing 225 beds, he said. Seahorse will remain a separate entity, however, KMC will manage and run the hospital, he added.

The company will be making a total investment of Rs 21 crore, which include the acquisition, loans and bad debts and 20% open offer. We will be investing Rs10 crore more into Seahorse to refurbish and installing new equipment, he added.

According to Kumar, the company will add 600 more beds in the next three years to become a 1,000-bed hospital. This will be done by both organically and through acquisitions smaller hospitals in the second tier cities of Tamil Nadu.

We have earmarked Rs 100 crore for our expansion, he said.

Towards this, the company will be raising Rs 30 crore from private equity players, Rs 50 crore from banks and institutions and the remaining Rs 20 crore from internal accruals. As of March 31, 2007, the company reported a turnover of Rs 21 crore and expect to end the current fiscal with Rs 25 crore. In the next five to six years KMC wants to become a 2,500-bed hospital group spread across the State, he said further.