Reliance to infuse Rs 202 crore to settle Karkinos Healthcare’s debts, pledges Rs 150 crore for revival

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Reliance Industries Limited, through its wholly-owned subsidiary Reliance Strategic Business Ventures Limited (RSBVL), will infuse Rs 202.16 crore to settle the debts of Karkinos Healthcare--a technology-led oncology platform led by former Tata Trusts official R Venkataraman-- undergoing insolvency proceedings.

This development follows the approval of its resolution plan by the National Company Law Tribunal (NCLT) on December 9 under the Corporate Insolvency Resolution Process (CIRP). The company was admitted into insolvency in May on the petition of one of its creditors Labindia Instruments Pvt Ltd.

Reliance Strategic Business Ventures emerged as the sole successful bidder and received approval to execute the plan through an NCLT.

Beyond settling debts, Reliance has pledged an additional Rs 150 crore to support Karkinos Healthcare’s operational revival and meet its working capital requirements.

The resolution plan approved by the Committee of Creditors (CoC) details specific payouts to creditors. Secured creditors receive Rs 37.59 crore, unsecured creditors are allocated Rs 65.12 crore, and operational creditors receive Rs 99.45 crore.

Implementation of the resolution is expected by February 2025 and involves amending Karkinos Healthcare’s Memorandum and Articles of Association (MoA and AoA), which will need to be filed with the Registrar of Companies.

Inside Karkinos Healthcare

Reliance’s association with Karkinos Healthcare dates back to December 2021, when it acquired a minority stake in the company via its subsidiary Reliance Digital Health Limited.

Founded in 2020, the platform focuses on the early detection and diagnosis of cancer. The company operates a distributed cancer care network and collaborates with hospitals and healthcare institutions to make affordable cancer care more accessible.

Karkinos has garnered investments from several notable individuals in the past, including Ratan Tata, Venu Srinivasan, Kris Gopalakrishnan, Ronnie Screwvala, Vijay Shekhar Sharma, Bhavish Aggarwal, Ravi Kant, and Sundar Raman.

Institutional investors include Ewart Investments Limited, a subsidiary of Tata Sons, besides the US-based Mayo Clinic and Rakuten Medical, a clinical-stage biotechnology firm from San Diego, which hold stakes in the company.

The company has partnered with prominent oncology institutions, including Tata Memorial Hospital, the Mayo Clinic, and various Indian Institutes of Technology (IITs). It also collaborates with Rakuten Medical on clinical trials. As part of its operations, Karkinos has partnered with approximately 60 hospitals by December 2023, enhancing access to oncology services, including testing and radiation therapy.

Under its 100% subsidiary, Karkinos Healthcare North East Private Limited (KHNEPL), the company had plans to set up a 150-bed multispecialty cancer hospital in Imphal, Manipur, with an estimated cost of Rs 150 crore.

The company reported consolidated revenues of Rs 22.17 crore in FY23, up from Rs 1.06 crore in FY22, but incurred a significant net loss of Rs 143.08 crore, per Care Ratings.

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