Fortis has just concluded raising Rs 1,000 crore via rights issue. Could you share an approximate break up of how does the firm plans to use the proceeds
We plan to invest Rs 200 crore in the medicity facility coming up in Gurgaon, another Rs 200 crore towards the acquisition of Wockhardt hospitals, a deal that we struck in August and plan to conclude by December. Rs 170 crore would be used up in retiring short-term debts of the firm. Redemption of preferential share would require another Rs 240 crore and Rs 150 crore would be spent in upgradation of facilities, future investments and other corporate purposes.
Geography wise, Fortis has emerged as the leader in the North and Wockhardt deal helped Fortis consolidate its position in Maharashtra and Karnataka. Which are the other areas Fortis would focus on
As you mention, we are already in the leadership position in North India. In terms of focus, it would be the southern part of the country as of now. In Andhra Pradesh, Tamil Nadu and Kerala, we just have one hospital at present. We would concentrate on these regions and keep our options open in other parts as well, say the northwest part and seize good opportunities as and when they arise. As far as approach is concerned, we would look for a healthy mix of properties in the tier I, tier II and tier III cities and towns in the portfolio because each of this has its own role in building the brand and contributing to the revenues. The decision of whether or not to acquire a property in certain city and town would hinge on factors like the population, the healthcare needs, how these needs are being met currently and how can we contribute in doing so.
Fortis ventured into Mauritius in its first overseas acquisition. Are you looking at more acquisitions overseas
Yes. We are open to acquiring properties overseas, even if such an expansion doesnt figure in companys immediate top five priorities. But the changing global economic dynamics has led to a situation in which we find that many such opportunities are there. We are receiving many proposals, and assessing each one very carefully and exploring the synergies with our existing business. The Mauritius acquisition was on the cards and part of our long-term strategy. As far as geographies are concerned, the probability of Fortis venturing out to countries in West Asia and Africa is high.
Fortis aimed to reach a target of 6,000 beds and 40 hospitals by 2012. By acquiring 10 hospitals of Wockhardt, the company has almost reached 5000 beds. In that case, are you revising your target How do you plan to reach the balance, through Greenfield projects or through acquiring standalone operational projects
Infact, if you include the bed strength of two Greenfield projects, in Shalimar Bagh and the Gurgaon medicity, to the bed strength we are set to get through the Wockhardt deal, we are already very close to the 6000 bed-mark. The target we had aimed is within close attainable distance. However, we will continue to look at options, both Greenfield projects and standalone hospitals.
This March you tied up with Chitkara University. With the government now warming upto the idea of private participation in medical education, are you interested in pursuing the opportunities there
Yes we are interested in exploring opportunities there, but there is a caveat. We are not looking at the opportunity from a strictly commercial angle, but because it is the logical area to grow in, considering our core competence and how much we can contribute to the medical education. However it doesnt yet figure in top priorities of the company.