Apollo Hospital share price plummet after IHH Exits with Stake Sale at Rs 838 crores

Integrated (Mauritius) Healthcare Holdings Ltd.,(IHH) sold its remaining stake in Apollo Hospital Enterprise Ltd causing a turmoil in the share prices of the Indian healthcare giant .

An arm of Malaysian sovereign fund Khazanah Nasional Bhd, IHH sold 68.4 lakh equity shares, i.e., 4.78 percent stake, at a price of Rs 1,246.10 per share, a discount of 2.7 percent to Wednesday’s closing price of Rs 1,281.60. The investment arm had appointed Deutsche Bank as the sole book runner for this stake sale, valued at Rs 838.5 crore.

IHH had bought stake in Apollo Hospitals in 2011, first purchasing 1.1 crore shares in May and then an additional 40.9 lakh shares in October, the same year. The average cost of acquiring these shares was Rs 480. Almost six years later, the firm has got back more than 2.5 times its investment in the hospital chain.

IHH had earlier sold 6.07 percent stake in Apollo Hospitals for Rs 1,070 crore on March 2, 2017. The proceeds would be used to meet working capital needs, the company had said in a statement issued on the same day, after the deal was announced.

IHH Healthcare Berhad, a healthcare group in which Malaysia government's sovereign wealth fund Khazanah Nasional holds a majority stake, is consolidating its India platform by rebranding Global Hospitals, in which it holds a majority stake, under the brand Gleneagles. The company has sold more than half of its stake in Apollo Hospitals, which analysts expect is an action towards strengthening its presence in India.