Apollo 24/7 Secures Rs 2,475 Crore Investment and 12.1% Advent Stake in Mega Merger with Keimed

The combined entity is valued at Rs 22,481 crore, positioning it as a leading retail health company in India. The merger aims to deliver substantial industry benefits and a pan-India presence, enhancing access to genuine medicines for 1.4 billion Indians within 24 hours.

Apollo HealthCo Limited or Apollo 24|7, a subsidiary of Apollo Hospitals Enterprise Limited, on Friday announced plans to raise Rs 2,475 crore ($339 million) in equity capital from Advent International, one of the world’s largest private equity investors. Apollo 24|7 also plans to integrate Keimed Private Limited, India’s leading wholesale pharmaceutical distributor, over the next two years.

The deal grants Advent a 12.1% stake in the merged entity, with the remainder split between Apollo HealthCo (59.2%) and Keimed (25.7%). The combined entity is valued at an enterprise value of Rs 22,481 Crores ($3 billion).

“Our mission has been to deliver high-quality healthcare to all Indians, at an affordable cost,” said Dr Prathap C Reddy, Apollo Hospitals Group Chairman. “Apollo 24|7 has delivered on this promise and has reached over 33 million Indians in a short span of time. With Advent’s investment and the merger of Keimed, the combined entity will be one of the country’s leading retail health companies,” he said.

The integration brings substantial industry benefits and potential business synergies. The merged entity will have a pan-India presence, positioning it as an industry-leading business model and retail health company.

“The size of the merged supply chain will allow 1.4 billion Indians access to genuine medicines within 24 minutes to 24 hours, 7 days a week,” Shobana Kamineni, Executive Vice Chairperson of Apollo Hospitals said.

Suneeta Reddy, Managing Director of Apollo Hospitals, called the merger as a significant step towards a comprehensive supply chain. “The merger of Keimed is a significant step in the integration of the comprehensive supply chain. The combined entity will deliver Rs 25,000 Crores of revenue in 3 years with 7-8% EBITDA. This deal brings together a formidable partnership of capabilities and strengths, to deliver exponential value for AHEL and its shareholders,” Suneeta Reddy said.

Advent identified the partnership as an opportunity to invest in India’s rapidly growing healthcare sector and work creatively to drive value. “We are excited to be bringing the best of Advent to support Apollo’s vision of ‘Touching a Billion Lives’,” said Pankaj Patwari, Managing Director of Advent India.

Keimed is valued at an enterprise value of Rs 8,003 Crores and pursuant to merger, Keimed shareholders would hold a maximum of 25.7% stake in the combined entity, while AHEL would continue to remain the largest controlling shareholder with at least 59.2% stake. The merger is subject to further corporate approvals to be obtained at the relevant time.