Manipal to acquire AMRI Hospitals for Rs 2,400 crore
Based on two people with knowledge of the transaction, Manipal Health Enterprises has paid $2,400 crore to acquire the AMRI (Advanced Medical Research Institute) Hospitals in Kolkata after protracted discussions and legal fights. "Manipal will pay about 75% of the transaction now and the remaining will be paid after a year as per the agreement. Also, all the cases against (AMRI promoter) Emami Group have been withdrawn," said one of the people.
With the acquisition of AMRI, the Manipal group's hospital portfolio will increase by 1,200 beds, bringing its total to nearly 9,500, making it the largest hospital chain in India.
There are currently close to 8,300 beds spread among 28 hospitals. Manipal and Emami began negotiating in 2018, and last year, Manipal decided to purchase AMRI for Rs. 1,800 crore. Nevertheless, the Emami Group, based in Kolkata, pulled out of the deal, leading Manipal to start arbitration proceedings.
In November, Manipal filed a petition with the Delhi High Court asking the court to enjoin the Emami Group from selling or otherwise transferring its ownership of AMRI to a third party or changing the organization's management while the arbitration is still pending.
Now that all parties have come to an agreement, the deal's worth has improved by 33%. Manipal and Emami's spokespeople both declined to comment.
Manipal is also the front-runner to buy from private equity investment True North an about 70% ownership in Kerala Institute of Medical Sciences (KIMS) Health, a hospital chain in Kerala.
AMRI is Manipal's third acquisition in the previous three years. In 2020, it paid about 2,100 crore for the Indian assets of Columbia Asia Hospitals, and in June 2021, it paid about 350 crore to Multiples Private Equity to buy Bengaluru-based Vikram Hospitals. With three multi-specialty hospitals in Kolkata and one in Bhubaneswar, AMRI manages 1,200 beds. AMRI is owned 98% by Emami and the remaining 2% by the West Bengal government.
A healthcare centre for Bangladesh, Nepal, Bhutan, and the seven north-eastern states, the deal will also make Manipal the largest private hospital operator in the eastern area.
Temasek Holdings will receive a 15% dilution of the promoters' 52% interest in Manipal Health. Temasek is raising its ownership of Manipal Health from 18% to about 51%.