Piramal Health sells diagnostic biz to Super Religare Labs

Piramal Health has announced the sale of its diagnostics business to Shivinder Singh-promoted, Super Religare Laboratories. The deal is valued at Rs 600 crore. CNBC-TV18 had reported on the impeding deal on July 12.

The revenue from Piramal Health’s diagnostics business stands at Rs 200 crore. Piramal will have board and executive committee representation.

Post deal, Super Religare Laboratories will become the largest pathology, radiology network. The combined entity will have 170 laboratories and 1,500 collection centres.

Commenting on the same, Ajay Piramal, Chairman, Piramal Healthcare, said the company will get Rs 300 crore upfront and the balance Rs 300 crore over three years. He confirmed that the entire proceeds will come to Piramal Healthcare.

Piramal stated that no debt is to be transferred in the deal. In something that will bring cheer to investors, Piramal said the company will declare a special dividend but was quick to add the sum may not be substantial.

Here is a verbatim transcript of the exclusive interview with Ajay Piramal on CNBC-TV18. Also watch the accompanying video.

Q: If you could start by explaining or giving us the details of the deal, whether it’s an all cash one, whether there is some debt transfer which is happening and your plans of acquiring some stake in the combined entity? These details if you can share with us?

A: It’s an all cash deal, it’s a deal, which is valued at Rs 600 crore. Today, we will be getting Rs 300 crore and over the next three years we will get another Rs 300 crore. SRL is a strong player; as you know we have some very strong doctors, perhaps the best combination of doctors that we have, we also have combination radiology as well as the pathology business.