India’s one of the second largest pathology lab chains, Metropolis Healthcare Ltd., has disclosed acquiring 100% equity in Core Diagnostics for INR 247 cr. The acquisition which has been approved by the board of Metropolis intends to reflect more on advanced cancer diagnostics in improving its presence in northern and eastern regions.
The deal would be settled on a cash component of 55 percent, and an equity share component would be 45 percent of it, and it is put up for shareholders’ approval. As the deal does not require any kind of further government or regulatory clearances, Metropolis expects that it will complete this deal in 60 days. On closure, Core Diagnostics will operate as a wholly owned subsidiary of Metropolis Healthcare.
Ameera Shah, Promoter and Executive Chairperson of Metropolis pointed out that this acquisition in cancer diagnostics would help in creating a strong backbone in one of the fastest-growing disease countries in the world-India. “With this acquisition we would be able to come out as the leading chain for cancer tests in the country, she said.
Core Diagnostics was founded in 2012. It is a premium diagnostics solutions company focusing on oncology. The company has nine labs across 200 cities in India with NABL and CAP accredited facilities. For FY24, Core Diagnostics had revenues of INR 110 crore, which is expected to reach INR 120-122 crore for FY25.
This acquisition will significantly enhance Metropolis’ oncology testing portfolio, thereby increasing its revenue contribution from 4% to 10%. Furthermore, the share of specialized tests in Metropolis’ overall revenue mix is expected to rise from 37% to 41%. The acquisition enhances Metropolis’ strong presence in western and southern India by expanding its footprint in northern and eastern regions.
Surendran Chemmenkotil, Metropolis Healthcare CEO said, this would bring the company to reach out all the major hospitals, along with an enhanced market expansion in regions. Core Diagnostics has tie-ups with over 6,000 specialty prescribers including 1,600 oncologists, and delivers over 1,300 sophisticated diagnostic tests. Integration of the best of Core’s knowhow with Metropolis’s 4,000 plus extensive tests is bound to unleash synergy, expanding quality diagnostics to the wider patients’ access.
This acquisition is in line with the strategy of Metropolis to focus on niche areas of diagnostics and advanced scientific capabilities, thus further strengthening its leadership in specialized testing and cancer diagnostics. The news saw shares of Metropolis Healthcare rise 2.39% to close at INR 2,187 on the BSE. Core Diagnostics’s acquisition by Metropolis strengthens its leadership in advanced diagnostics and reaffirms its commitment to addressing India’s growing healthcare needs.
