Hospital chain Aster DM plans $108 mln India expansion as Gulf deal nears completion (updated)

Aster DM Quality Care

20/03/2024 11:58

(Added business expansion plan, background)
       BENGALURU, March 20 (Reuters) - Indian hospital chain
Aster DM Healthcare  ATRD.NS  said on Wednesday it plans to
spend up to 9 billion rupees (about $108 million) to expand
domestically as it nears the completion of selling its Gulf
business.
    Aster said it aims to be among the top three hospital chains
in India and expects to add about 1,500 beds by fiscal 2027 to
the 4,857 beds it currently has across 18 hospitals in the
country.
    In contrast, Apollo Hospitals  APLH.NS , India's largest
private hospital chain, has more than 10,000 beds across over 70
hospitals, while Manipal Health has 33 hospitals with more than
9,500 beds.
    Aster said it would expand its presence both by building new
hospitals and by boosting the capacity at existing centres, it
said.
    Last November, Aster agreed to sell a majority stake in its
Gulf business, which accounts for about 75% of its overall
revenue, to a consortium led by private equity firm Fajr
Capital.
    After a proxy advisory firm threatened to scuttle the deal,
Aster said it would distribute about 70%-80% of the $903 million
net proceeds from the sale to shareholders.
    The Fajr Capital-led consortium got local anti-trust
clearance and approvals from key partners for the deal, Aster
said, without specifying when it expects the deal to close.
    While India accounted for only a quarter of Aster's total
revenue in the third quarter, the growth in the region outpaced
the revenue growth in the Gulf.
    Since announcing the deal in late November, Aster's shares
have jumped nearly 32% through their close on Wednesday.
 
 ($1 = 83.1430 Indian rupees)

 (Reporting by Ashish Chandra in Bengaluru; Editing by Dhanya
Ann Thoppil)
 ((ashish.chandra@thomsonreuters.com; +91 7982114624;))