Seven Hills hospitals for Sale: Apollo Hospitals, Aster DM, Narayan Health initial bidders
MUMBAI: To acquire the assets of Seven Hills hospitals, several hospitals are vying for the race, according to a recent media report.
Narayan Health is reported to have entered in partnership with the Piramal group for the purpose of bidding while Apollo hospitals and Aster DM are also in the race as early bidders for the acquisition of the assets of Seven Hills hospitals.
People directly involved in the bidding process told ET that some of these players have put in their expression of interest with the resolution professional for possession of the two hospitals that are in Mumbai and Vishakhapatnam.
This year, a State Bank of India (SBI) consortium and lenders led by Axis Bank has initiated the insolvency procedure against the Seven Hills due to an estimated debt of Rs 1,300 crore.
The hospital chain was started by Andhra Pradesh-based medical professional Jitendra Maganti and was built in Mumbai under a public-private partnership of nearly Rs 1,000-crore investment. The hospital failed to take off, with the local municipal corporation suing the hospital for non-compliance with the memorandum of understanding.
"We are currently under silent period and would not like to comment," Apollo Hospitals spokesperson told ET.
Seven Hills is the second large hospital chain that is trapped under debt and distressed for a buyer and the first one is Fortis Hospital, which is involved in a bidding war since last three months. Seven Hills operates nearly 1500 beds in Mumbai and Vishakhapatnam.
However, in November the lenders of Seven Hills had told ET that they felt that the hospital can turn around even if it can start operationalizing 700 beds, which would make an EBITDA of Rs 180 crore in two-three years time. At that time the lenders were looking at a valuation of Rs 2,500-3,000 crore.
Medical Dialogues had earlier reported that Seven Hills Hospital is facing a major financial crunch that forced it to shut down its outpatient department services in January 2018 to save expenses. Moreover, the hospital also ded not been able to pay its employees including employed and consultant doctors, which have forced the doctors to refrain from coming to duties. The hospital came out with the decision to shut down its OPD after discussing with the senior doctors and management. One of the major reasons for the shutdown comes as saving the electricity bill which ram to the tune of Rs 1 crore per month.
Read also: Seven Hills Hospital Crisis: OPD shuts down, doctors unpaid for 6 months
The Brihanmumbai Municipal Corporation (BMC) had also taken stringent action against the hospital over non-payment of Rs 9 crore property tax.
Read also: Catastrophe at Seven Hills, BMC seals admin office over unpaid tax of Rs 9 crores