The Hindu Business Line : Fortis to expand hospital network; plans IPO

FORTIS Healthcare is planning to expand its network of hospitals across North India at a total investment of over Rs 1,100 crore in the next five years. While tapping the capital markets to fund the expansion is on the cards, some portion of the investments would be made through a mixture of debt and equity.

According to Mr Shivender Mohan Singh, Joint Managing Director, Fortis Healthcare, "We are planning to come out with an initial public offering (IPO) but we have not yet finalised a time frame."

Currently, Ranbaxy holds 17 per cent in the company, while the rest is held by the promoters and associates.

The company is focusing on increasing its capacity to 4,000 beds in 10 hospitals, up from the existing 600 beds in four hospitals. As part of this initiative, Fortis will be setting up a medi-city in the footsteps of John Hopkins Medical Centre at Gurgaon in Haryana.

Called Fortis International Institute of Medical and Biosciences (FIIMBS), it will house a medical college, an attached hospital, other allied sciences institute and a referral centre among other facilities.

Other northern region markets that could see the setting up of Fortis hospitals are Jaipur, Shimla, Jalandhar, Ludhiana and some other smaller towns.

Mr Singh said that hospital projects have a very long gestation period and it normally takes two-and-a-half to three years to make cash profits.

The hospital chain is also planning to get international patients to come here for treatment. "We are thinking of commencing discussions with the UK's National Health Service or any other body to send patients over to India. We have not yet initiated this or sewed up any deals," said Mr Harpal Singh, Chairman and Managing Director of the company.

Ranbaxy lets health insurance pact lapse

THE promoters of Ranbaxy Laboratories have kept their interest in the health insurance sector on the backburner and have let the agreement with the US health insurer, Cigna, lapse.

According to Mr Harpal Singh, the problems related to the high capitalisation norms for health insurers have been a deterrent to the industry.

"The promoters had planned to be present in the pharma industry, the healthcare services sector, the pathological labs business and the health insurance sector as there is a synergy between these businesses," he added.

While three of these businesses have taken off in a big way, the plans for health insurance could not see the light of the day.

More Stories on : New Projects | Health | IPOs | Medical Institutions & Hospitals

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