Hospital chain Apollo Hospitals Enterprises Ltd has signed a deal to acquire the drug retail chain of Hyderabad-based Hetero Med Solutions Ltd for Rs. 146 crore. The deal will see Apollo taking over 320 outlets of Hetero Med in Telangana, Andhra Pradesh and Tamil Nadu.
Post the completion of acquisition these stores is expected to be renamed as Apollo Pharmacy. Apollo will buy the business on a slump-sale basis. It does not include any equity stake; the company informed the stock exchanges on Wednesday.
Hetero\'s stores are located in such a way that they can be easily linked with Apollo\'s supply chain, making integration easier, said Shobana Kamineni, Executive Vice-Chairperson, Apollo Hospitals, who is at the helm of the company\'s drug retail division.
Apollo plans to have specialty pharmacies that focus on specific diseases such as diabetes, and Hyderabad will be the testing ground for the initiative. “We will have something in this line in the next 60 days”.
The company is expected to complete the acquisition process in two quarters, subject to the due diligence and other statutory formalities and to break even by the end of this year or early next year. The acquisition would not have much of impact on the existing pharmacy business, as the negative EBITDA in Hetero Pharmacy is marginal.