Apollo Hospitals Shares Erase Early Gains as Promoters Sell 3.6% Stake
Apollo Hospitals’ promoters are selling up to 5 million shares, or 3.6% stake, in the company at a floor price of Rs 1,450 per share, which is expected to fetch around Rs 725 crore.
Apollo Hospitals Enterprise Ltd shares erased early morning gains to trade flat on Thursday, i.e. 12 September, as promoters of the company are reportedly issuing 5 million shares to reduce debt. Shares of Apollo Hospitals rose as much as 5.5% in initial trade, but later wiped all its gains to trade at Rs 1,494.60, down 0.2%, at 10:27 am.
According to reports, Apollo Hospitals’ promoters are selling up to 5 million shares, or 3.6% stake, in the company at a floor price of Rs 1,450 per share, which is expected to fetch around Rs 725 crore. The transaction is likely to be completed in a day or two.
After the sale, promoter group shares in Apollo Hospitals would stand at around 30.8% from the current 34.4%.
The transaction reportedly aims to help promoters reduce their pledged shares in Apollo Hospitals to around 20%. The company officials had earlier in July said that promoters’ pledged shares stood at 68% of their total holdings.
Citigroup is acting as placement agent and would be responsible for building the book for the deal. Apollo Hospitals has been in action this year, making some important decisions to control its rising debt levels. Earlier this year, Housing Development Finance Corp. Ltd (HDFC) had signed a deal with the Apollo Hospitals Group to acquire the latter’s entire 50.8% stake of in the health insurance joint venture for Rs 1,336 crore. Post the transaction, Apollo Munich Health Insurance was to merge with HDFC general insurance arm HDFC Ergo.
There were also reports of the Apollo Hospitals Group looking to sell stake in two of its subsidiaries, Apollo Health And Lifestyle Ltd and Apollo Proton Therapy Cancer Centre Pvt. Ltd, to raise up to $200 million.
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