Apollo Exits From Its Original Sri Lanka Hospital Startup

EHM News Bureau

Apollo Hospitals, Colombo, which had in recent years emerged as one of the leading centres of medical excellence in the region and was under the stewardship of Apollo Hospitals Enterprise Limited (AHEL), saw a change in the ownership. AHEL recently announced selling of its stake in Apollo Hospitals, Colombo to Sri Lanka Insurance Corporation Ltd. With 52.03 million shares, AHEL had 33.22 per cent stake in the hospital and was operating in Sri Lanka under the Lanka Hospitals Corporation (LHC).

"The decision was taken after considerable deliberation, keeping in mind our clear objectives of increasing our own shareholder value and long-term business goals," said Suneeta Reddy, Executive Director, Finance, Apollo Hospitals Enterprise Limited.

But adding a touch of personal nostalgia, she said, "As is with every institution that we have built and developed over the last two decades, Apollo Hospitals, Colombo is a good example of patient centricity. We infused intellectual and emotional capital that are core values associated with all Apollo Hospitals."

The decision comes in the wake of the recent increase in the shareholding of Sri Lanka Insurance Corporation Ltd (SLIC) from 19.86 per cent to 36.07 per cent. With only a minority share holding, it was difficult for Apollo Hospitals to operate effectively. "And fortunately, Apollo has found that the offer made by SLIC is adequate and good enough to accept," Reddy added. SLIC triggered the takeover code as per the Take Overs & Mergers Code 1995 of Colombo Stock Exchange by increasing its stake to more than 30 per cent. The Board of LHC appointed an independent financial advisor to evaluate the open offer of SLR 28 per share. AHEL currently holds 52.03 million shares. The independent advisor's report considered the offer attractive and as a result the board of AHEL has decided to offer its entire stake in the company.

"Since the hospital's commissioning in June 2002, Apollo Hospitals, Colombo, has made a mark for itself in the healthcare space and has provided quality care for the people of Sri Lanka. AHEL will ensure that the transition to the majority stakeholder is smooth and also make certain that the hospital's operations are not unduly affected," Reddy said.