Apollo Health Street (AHSL), providing outsourcing solutions in the healthcare industry, has filed its DRHP with SEBI on 19th March, 2008 to enter the capital market with a public issue of 65 lakh equity shares of Rs 10 each at a price to be decided through the book building route. The issue comprises of a net issue of 63 lakh equity shares to the public and a reservation of 2 lakh equity shares to the employees of the company.The issue would constitute 20.63% of the fully diluted post issue paid-up capital of the company.
The BRLMs to the issue are ICICI Securities and Edelweiss Capital. The company proposes to list its shares on BSE and the NSE.
The company intends to use the proceeds from the issue for partly financing the company's repayment of debt of Rs 96 crore for acquisition of Zavata Inc. of US and Rs 62 crore to meet the construction and other costs of the up-coming Chennai facility and for general corporate purposes.
Apollo Health Street incorporated in 1999, is a healthcare services company offering business process outsourcing and information technology solutions and services. Its services portfolio includes revenue cycle management; medical collection, billing, coding and transcription; claims administration and adjudication; network and medical management; back support services; and clinical information systems implementation. The company also offers software development, integration and maintenance services to healthcare organizations and telemedicine solutions.
Maxwell Mauritius, the wholly-owned subsidiary of Temasek, and One Equity Partners, have invested $7.5 million in AHSL. The company had recently bought US-based BPO and enterprise support solutions company Zavata for $170 million. The equity contribution in the deal from Apollo group was $25 million, while One Equity Partners (the investment arm of JP Morgan Chase & Co) and Temasek Holdings invested a combined $25 million. The debt of $120 million was raised from Bank of India and Barclays Capital.
The company has also entered into a strategic technology relationship with NIIT whereby it was agreed that a medical university would be set up by AHSL and NIIT would be responsible to develop and engineer the content thereof. Accordingly, Medvarsity was incorporated with AHSL subscribing to 85% of the share capital of Medvarsity and NIIT holding the rest.
For the year ended March 31, 2007, the company reported income of Rs 142.81 crore and net profit of Rs 6.05 crore as against income of Rs 44.82 crore and a net profit of Rs 99 lakh for FY06. For six months ended September 30, 2007, the company income was Rs 103.95 crore. There was net loss during the period of Rs 15.25 crore as compared to an income of Rs 49.29 crore and net loss of Rs 2.22 crore for the corresponding period of 2006.