Dr Agarwal's Healthcare to target merger with listed subsidiary within a year of listing

Dr Agarwal's Healthcare to target merger with listed subsidiary within a year of listing

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IPO-bound Dr Agarwal's Healthcare, India's largest eye care hospital chain by revenue, will start work on a merger with its listed subsidiary Dr Agarwal's Eye Hospital immediately post listing and look to complete the process within 12 months, according to the former's management.

Speaking at a media briefing on January 24, the management was responding to a question posed by Moneycontrol on the timeline of the expected merger between both the firms, which differ in formats and geographical slicing.

Dr. Agarwals Healthcare currently holds a 71.9% stake in Dr Agarwal's Eye Hospital which was established in 1994. Incidentally, the red herring prospectus of the company indicates a window of three years for the merger process. "We may, subject to compliance with applicable law, including obtaining requisite corporate and regulatory approvals, approvals from lenders, business synergy, market conditions, growth potential, explore opportunities to merge the Company and AEHL, and endeavour to do so within three years post listing of the Equity Shares of the Company. No such proposal has been considered, as on date, with our listed subsidiary, AEHL and its board of directors or shareholders," as per the red herring prospectus

The IPO of TPG- and Temasek-backed Dr Agarwal's Healthcare will be open for subscription from January 29 to January 31 and January 28 has been reserved for the anchor portion. The firm is targeting a post-money valuation of Rs 12,700 crore to Rs 12,900 crore, according to sources.

The price band has been fixed between Rs 382 to Rs 402 per equity share of face value Re 1 each for its maiden initial public offer. Investors can bid for a minimum of 35 shares and in multiples thereof.

The IPO is a mix of fresh issue of equity shares worth Rs 300 crore by the company, and an offer-for-sale of 6.95 crore equity shares by promoters and investors.