International Finance Corporation to invest Rs458 crore via equity in Apollo Health

International Finance Corporation (IFC) has announced to invest about $68 million (Rs 458 crore) via equity in Apollo Health and Lifestyle Ltd.The latter is expected to expand its network of smaller-format healthcare centers with the funds.

Reportedly, the World Bank’s private-sector investment arm said it will put in $34million for its own account and an equal amount for IFC’s Asset Management Company.

The Apollo Health and Lifestyle plans to open 151 small-format healthcare centers, 9 maternity facilities and 64 pathology labs, which will be supported by 765 collection centers, in several cities throughout southern and eastern India.

The total project cost is estimated to be about $135 million, disclosed IFC.

Smaller-format healthcare centres is still a relatively small sector in India and many other emerging markets, IFC said, adding that its investment will show other potential investors how such models can succeed in emerging markets.

Apollo Health is a unit of Apollo Hospitals Enterprise Ltd. Mumbai-listed Apollo Hospitals, founded in 1979 by Dr Prathap C Reddy, is India’s largest hospital chain. It also operates pharmacies and provides consulting, tele-medicine and healthcare education and training services.

Reddy and family members own 34.4 per cent of the hospital chain. Other significant shareholders include Integrated Healthcare Holdings (Mauritius) Ltd (10.9 per cent), Massachusetts Mutual Life Insurance (8.7 per cent), and Apax Group (5.1 per cent).

IFC makes both debt- and equity-style investments in India across sectors. In the healthcare sector, it has invested in Apollo rival Fortis Healthcare Ltd and Max Hospitals. It has previously also invested in eye-care firm Eye-Q Vision, dialysis chain NephroPlus, home healthcare firm Portea and diagnostics chain SRL.

In March this year, IFC came in as an anchor investor in Bengaluru-based oncology chain HealthCare Global Enterprises Ltd. In April, it said it planned to invest Rs61.5 crore ($9.45 million) in Kanpur-based healthcare services provider Regency Hospital Ltd.