The Hindu Business Line : IFC extends finance to Apollo Hospitals, Max India

Chennai, May 14 The International Finance Corporation, the private financing arm of the World Bank, is extending finance to two healthcare companies — Apollo Hospitals Enterprise Ltd and Max India Ltd; to the first through a loan and to the second through an equity investment.

Max India’s board will meet on May 15 to consider a proposal to issue equity shares to the IFC on a preferential basis for an amount not exceeding Rs 150 crore.

According to information available on IFC’s Web site, its assistance to Apollo Hospitals will include up to $35 million (Rs 175 crore) as “senior loan” and a convertible loan up to $15 million (Rs 75 crore).

Apollo Hospitals plans to invest $200 million over the next few years on expansion and equipment purchase and to develop the Apollo Reach network of hospitals. The Apollo Reach network will come up in semi-urban and rural areas and will be smaller than the group’s existing facilities. The first three Reach hospitals are in Karimnagar and Kakinada in Andhra Pradesh and Karur in Tamil Nadu.

According to the IFC, Max India Ltd through Max Healthcare Institute Ltd, in which it holds a 70 per cent stake, plans to expand its network of hospitals at an investment of Rs 472 crore ($93 million). The plan is to expand the existing facilities in the National Capital Region and also set up two new hospitals — at Shalimar Bagh and Greater Noida — which will take Max Healthcare’s capacity to about 2,000 beds.

IFC’s proposed investment of Rs 150 crore ($30 million), according to the corporation, will bring the much-needed capital and provide a strong signal of support to the health care sector in India, which is experiencing difficulties in raising affordable financing in the current environment.

The facilities at Shalimar Bagh and Greater Noida will be multi-speciality tertiary care hospitals with about 300 beds each.