Thyrocare Technologies share price was trading lower by over 3 percent at open on June 28 after PharmEasy acquired a 66.1 percent stake in Thyrocare on June 25 for a consideration of Rs 4,546 crore.
At open, the stock was trading at Rs 1,395.05, down Rs 53.00, or 3.66 percent. It has touched an intraday high of Rs 1,445.10 and an intraday low of Rs 1,377.70.
The stock price has surged over 176 percent in last 1 year.
API Holdings (API), the parent company of PharmEasy, announced the "signing of definitive documents to acquire 66.1 percent stake in Thyrocare from Dr A Velumani and affiliates at a price of Rs 1,300 per share aggregating to Rs 4,546 crore," an official statement noted.
Also Read: IPO-bound PharmEasy buys Thyrocare
The deal was announced after the market hours on Friday. Shares of Thyrocare rose 6.23 percent to end at Rs 1448.05 on BSE.
Several analysts and competitors Moneycontrol spoke to said the deal may give PharmEasy access to Thyrocare's diagnostic infrastructure and a profitable business, but still, the startup may be paying a high price.
Analysts say COVID-19 testing, which is seasonal, could be the reason for elevated valuations of diagnostic. COVID-19 testing contributed about a quarter of revenues for the diagnostic companies in FY21.
Dr A Velumani, the founder of Thyrocare, will be separately acquiring a minority non-controlling stake, of less than 5 percent in API Holdings as part of a series of equity investments by existing and new investors of API, the statement added.
CNBC TV 18 reported that the Dr Velumani would be investing Rs 1500 crore and hold 4.9 percent stake in API.
The lack of a succession plan at Thyrocare could be a key reason for Dr Velumani to sell the company at a time when valuations are rewarding, sources privy to the development had earlier told Moneycontrol.Commenting on PharmEasy-Thyrocare deal, Vishal Kampani, Managing Director of JM Financial Group, said, "This deal brings together India’s leading digital health platform and one of the most cost-efficient diagnostics solution providers to create an unbeatable integrated digital health platform. This partnership will create tremendous opportunities and synergies for the entire ecosystem of consumers, doctors and suppliers in the Indian healthcare sector."