24 January 2019: The hospital management had objected to a sole bidder quoting low price; the facility was ready to be run and managed by an Abu Dhabi company by April this year
All set to be managed and run by Abu Dhabi-based billionaire BR Shetty’s BRS Ventures, the debt-ridden SevenHills Hospital in Marol has suffered another setback. After the hospital’s founder and a group of companies complained to the National Company Law Tribunal (NCLT) that the bidding process last year was not fair and procedures weren’t followed, the quasi-judicial body has directed the Corporate Insolvency Resolution Process (IRP) committee to conduct rebidding and complete it in the next six months.
Last year in October, BR Life Healthcare, a part of BRS Ventures, had reportedly bid for the hospital and won the tender to manage and run it. Consequently, the hospital’s founder and managing director Jitendra Das Maganti and some other investors like JP Morgan objected to the bid and approached the Hyderabad bench of the NCLT. They alleged that BR Life Healthcare was the sole bidder and had quoted a very low price. According to sources, Maganti had objected to the bid as he had also lost his Visakhapatnam hospital and a bungalow in Hyderabad to the bid. The NCLT had given the IRP three months to renegotiate the price with BRS Ventures.
After the bidding process, the officials from BRS Ventures were regularly visiting the hospital to get estimates for medical equipment, and meeting vendors and suppliers to record the pending dues. The hospital, in fact, was set to reopen by April this year. With the hospital’s total dues estimated to be Rs 2,100 crore, this new development will further delay the process and escalate its losses, said a doctor on condition of anonymity. “We were hoping that the hospital will start soon, but Wednesday’s verdict will delay the process by another six months. With doctors and staff not receiving their salaries, the hospital has not been functioning fully. We were hopeful that the situation would change with the new owner, but the year has begun with a spin,” said the doctor quoted above.
Once thought to be the city’s first 7-star health facility, the 1,000-bed Marol hospital was declared bankrupt by the Hyderabad bench of the NCLT after it defaulted on bank loans worth Rs 1,300 crore. The hospital chain went under the hammer in 2018 after lenders initiated insolvency proceedings.
After Mirror reported the hospital sale to BRS on October 18, 2018, Maganti, in an email to this reporter, had said, “I have paid Rs 870 crore as interest and principal to the banks in the last seven years. As the banks had started retaining 25 per cent of our revenues every month, we went into financial distress. On this pretext, banks sold their loan to JM Financials and then approached the NCLT. All this is in public domain.”
When contacted, Gurjeet Singh, the IRP representative who is part of the committee and currently looking into the hospital’s management, refused to comment. “I am not the right person to comment on this,” he said.
The 1,000-bed Marol hospital was declared bankrupt by the Hyderabad bench of the NCLT after it defaulted on bank loans worth Rs 1,300 crore. The chain went under the hammer in 2018 after lenders initiated insolvency proceedings.
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