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L.N. Revathy

Coimbatore , Aug 30

METROPOLIS Health Services (India) Pvt Ltd is contemplating private equity funding of Rs 20-25 crore to strengthen its equity base, for better controls and support its expansion programme.

Disclosing this to Business Line, its Managing Director Dr G.S.K. Velu said the details of this issue would be known within the next two to three months.

The company is in talks with a venture capitalist. He was, however, unwilling to share more information.

This diagnostic laboratory and research centre has earmarked an investment of Rs 60 crore over the next two to three years. Stating that the balance amount would come through internal accruals and reserves, he said "We are a debt-free company at present. The proposed private placement would dilute our holding and enable us to have better controls. We are actually preparing ourselves for public offering, four years down the line."

It has established a chain of eight laboratories at present and is in the process of setting up four more before the end of this year. "We want to establish our presence across 50 towns in a span of two years. We intend to set up 15 laboratories. The rest will either operate as collection or satellite centres," he added.

Metropolis has different levels of investments on its set up. The tertiary laboratories, such as the ones in Mumbai and Chennai are regarded as centres of excellence. The investment cost on such high-end labs is said to be Rs 15 crore. The secondary labs are the next level, established on an outlay of Rs 2.5 crore, while the investment on primary labs or collection centres is said to cost the company Rs 50 lakh.

The Coimbatore arm of the lab - `Lister Metropolis' - is expected to be kick started in October. Answering a query, Dr P. Srinivasan, Managing Director, Lister Metropolis Laboratory and Research Centre Pvt Ltd, said that the company perceived the need and saw the potential for establishing such a set up in the city.

"Quite a number of patients come to Chennai for tests and collect the result via the Net. We were pulled by these factors and driven by our corporate clients for setting up our base in the city."

Though it has existed for about two-and-a-half decades, Metropolis has started expanding only in the last couple of years to emerge as a global player. It has set up clinical laboratories in Sri Lanka and Seychelles. "The Bahrain and Dubai labs would come up shortly," Dr Velu said.

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