Hyderabad-based Global Hospitals has recently acquired a Chennai hospital, Sri Kanchi Kamakoti Sankara Hospital. The Madras High Court permitted the Sri Kanchi Kamakoti Peetam charitable trust to encash the earnest money deposit of Global Hospitals for Rs 257 crore and complete the sale of the hospital at Permbakam in terms of the advertisement. At the end, only two bidders, that is, Shriram Properties,Chennai, and MS Global Hospitals, Secunderabad, were left in the run to acquire the Chennai-based hospital.
Global Hospitals offered Rs 257 crore, which was subject to the undertakings given in the affidavit, including running the existing hospital situated on an 18-acre land, retaining the employees and also providing 50 free beds. Shriram Properties did not agree to the above condition and had to lose the race to Global Hospitals.
“We plan to transform the Sankara Hospital into a health city by incorporating facilities like liver, kidney and a multi-organ transplant institute, a heart and lung institute, neuro sciences, trauma, orthopaedic and cancer institutes and providing alternative therapy in the next 5-10 years with an investment of around Rs 750 crore. We also plan to construct service apartments. Consequently, we will also increase the number of beds to 1,000,” said Dr K Ravindranath, Chairman, Global Hospitals.
The trust was initially formed to provide charitable medical services, and also medical education. However, the trust had become heavily indebted and no longer was able to run the hospital. In addition, the plan to establish the medical college too had to be scrapped.
This information was submitted by TR Rajagopalan, who was the counsel appearing for the trustee. In spite of the bas condition, the trust were keen on keeping the hospital set-up at that location as they felt that it served as a major healthcare provider for the people of neighbouring villages. Hence, they decided to sell out to at least keep the hospital running.
Another reason cited by Rajagopalan for Global to win the bid was the offer of Shriram Properties of ultimately transferring the hospital to M/s Juventus Bundwell PrivateLtd, an infrastructure company created by Shriram Properties. Whereas, Global Hospitals wanted the hospital purely for providing healthcare, and they had experience in running hospitals since a long time. Rajagopalan said, “Although the offer of Global Hospitals (Rs 257 crore) was less than that of Shriram Properties (Rs 265 crore), the trustees were keen on fulfilling the objectives of the trust in running the hospital.” Global Hospitals contemplated settlement of the bank dues by May 15, 2007 and the remaining amount by June 2007. Source: EH
