Dr Lal PathLabs sets sights on big buys to expand in south
Dr Lal PathLabs, India's largest diagnostic chain, is looking at a potentially large acquisition to increase its foothold in south India. If the asset is of a strategic fit, it could look at a deal size of Rs 3,000 crore-Rs 4,000 crore, said a senior company official.
«We have around Rs 1,000 crore (net) cash, we can leverage our balance sheet, we can use our equity, size will not hold us,» said Ved Prakash Goel, group CFO, in an interview to ET. «There are people who are there in the market, the (valuation) expectation is high,» Goel said.
Dr Lal is typically looking at assets with Rs 300-400 crore revenue, with the right revenue mix, good quality and governance practices. It has formed an M&A team to evaluate potential acquisition opportunities in the market.
«In south, we are open to looking at M&A opportunities, we did (acquisition of) Suburban (Diagnostics in the Western region). It was our first large sized M&A, so we took about two years to figure out the whole integration process, how do we want to run it, lot of management bandwidth went into stabilising and putting into the growth path, right now the management bandwidth is available, cash on the books are available,» said Shankha Banerjee, CEO of Dr Lal.
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