HCG buys oncology hospital labs and clinical trials business of Strand Lifesciences
HealthCare Global Enterprises Limited (HCG) said that it has acquired oncology hospital labs and clinical trials business of Strand Lifesciences for around INR 81 crores with a set-off of around INR 7 crores towards receivables.
Simultaneously, the Indian specialty healthcare service provider has sold its stake of 38.5% in Strand Lifesciences to a Reliance Industries group company for INR 157 crores.
Strand Lifesciences is a precision diagnostics company, which is mainly engaged in bioinformatics and genomic testing in India, will no longer continue to be an associate company of HealthCare Global Enterprises.
The two deals have given a net cash inflow of about INR 83 crores for HealthCare Global Enterprises apart from the take-over of Strand Lifesciences’ labs and clinical research business.
According to Dr. BS Ajaikumar — Executive Chairman of HealthCare Global Enterprises, the sale of stake in Strand Lifesciences is part of the company’s strategy to optimize capital allocations around cancer care in India.
Dr. BS Ajaikumar further said: “Now, with the acquisition of Strand’s hospital labs and clinical research business, HCG not only enhances in-house diagnostic and research capabilities and offerings, but will also be able to drive higher awareness and adoption across the network and thus positively impact a much larger patient population.
“We will continue to work with Strand to utilize their strengths in bioinformatics and data analytics as we generate valuable cancer patients’ data and implement EMR / digitization across the network to emerge as the leading precision medicine company focused on oncology in India.
“HCG also gets the ability to pursue clinical trials business in-house which given the diversity and scale of HCG Cancer operations would be an attractive proposition to build upon.”
In 2018, HealthCare Global Enterprises merged its hospital labs and clinical trials business operating under Triesta brand with the clinical diagnostics vertical of Strand Lifesciences to jointly focus on specialized oncology space. The transaction saw the oncology-focused private hospital group become the single largest shareholder in Strand Lifesciences.
Later on, the newly combined Strand Lifesciences entity had raised capital from private equity investors and followed it up with the acquisition of the Indian business of Quest Labs, which was divested during the onset of the Covid-19 pandemic.
Through the latest deal, HealthCare Global Enterprises has acquired hospital labs in more than 12 cities such as Bengaluru, Mumbai, Jaipur, Kolkata, and Ahmedabad. The company has also acquired a digital pathology network.
Raj Gore — CEO of HealthCare Global Enterprises said: “These high-quality NABL/CAP accredited full-service labs, located across key hospitals and geographies, with comprehensive oncology focused test menu, including specialized histopathology, molecular diagnostics and liquid biopsy capabilities, are a strategic fit for HCG’s oncology care model. Integration of these labs in our ecosystem will augment patient quality of care and also offer scaling-up and margin improvement opportunities over the long-term.
“Now with the re-acquisition of our labs, which have also progressed in scale, profitability and quality of offerings over the past few years, and additional capital we have received from the stake divestment transaction, we are already seeing returns from our consolidation initiatives.”