KIMS Announces Merger of Rajyalakshmi and Sarvejana Healthcare

Krishna Institute of Medical Sciences Limited (KIMS) has announced the approval of the proposed merger between its step-down wholly-owned subsidiary, Rajyalakshmi Healthcare Private Limited (RHPL), and its holding company, Sarvejana Healthcare Private Limited (SHPL). The merger was sanctioned by the boards of both companies on July 22, 2024.

Rajyalakshmi Healthcare Private Limited, the transferor company, operates as a wholly-owned subsidiary of SHPL and is also a step-down wholly-owned subsidiary of Krishna Institute of Medical Sciences. As of March 31, 2024, RHPL reported a turnover of ₹1,564.35 million and PAT (Profit After Tax) of ₹168.02 million.

Sarvejana Healthcare Private Limited, the transferee company, is the holding company of RHPL and a material subsidiary of Krishna Institute of Medical Sciences. Both entities are involved in healthcare activities. As of March 31, 2024, SHPL reported a turnover of ₹3,078.88 million and PAT of ₹393.44 million.

The rationale behind this merger is to enhance operational efficiency, accelerate business growth, and improve overall profitability and scale of operations. By consolidating the two entities, the company aims to streamline operations and leverage synergies between RHPL and SHPL, which are engaged in similar healthcare activities. The merger is expected to facilitate a more integrated approach, fostering better coordination and resource utilisation, which should drive growth and enhance profitability.

The merger will not involve any cash consideration or issuance of new shares, as RHPL is a wholly-owned subsidiary of SHPL. Consequently, there will be no changes in the shareholding pattern of Krishna Institute of Medical Sciences Limited.

Overall, this strategic merger is intended to strengthen the company’s position in the healthcare sector by consolidating its subsidiaries into a more efficient and scalable entity, thus positioning the company for enhanced performance and competitive advantage in the market.

About Krishna Institute of Medical Sciences Limited

Krishna Institute of Medical Sciences Limited is one of the largest corporate healthcare groups in Andhra Pradesh and Telangana, based on patient volume and treatment range. The company provides a wide spectrum of healthcare services, including primary, secondary, and tertiary care in 2-3 tier cities, along with a quaternary healthcare facility in tier-1 cities.

On July 24, 2024, the share price of Krishna Institute of Medical Sciences Limited opened at ₹2,123.45, touching the day’s high at ₹2,123.95, as of 10:17 AM on the NSE.

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