Metropolis Healthcare Ltd, India’s second-largest pathology chain, has agreed to buy Agra-based diagnostic service provider Scientific Pathology in its second acquisition within three months.
The purchase price is expected to be between Rs 55 crore and Rs 83 crore ($6.3-9.5 million), subject to adjustments, Metropolis said in a stock-exchange filing on Monday.
The deal comes after Metropolis agreed in December to acquire oncology-focused diagnostic services provider Core Diagnostics to expand its advanced cancer testing portfolio and strengthen its presence in northern and eastern India.
Mumbai-based Metropolis said it will acquire Scientific Pathology from its founder Ashok Kumar Sharma and that the deal includes the purchase of the target firm’s laboratories and collection centres.
The company will carry out the transaction through its subsidiary Metropolis Clinical Pathology Pvt Ltd. Metropolis will subscribe to optionally convertible debentures worth Rs 59.03 crore to fund the subsidiary while Sharma will invest in the entity and hold a stake of up to 10% in Metropolis Clinical Pathology on a fully diluted basis.
Metropolis expects to complete the transaction within 45 days, pending regulatory approvals and fulfillment of certain conditions.
The acquisition will strengthen Metropolis' diagnostic network in Uttar Pradesh, particularly in Agra and surrounding areas, by driving test volumes and improving regional penetration. “With our recently established network of eight labs and 80-plus franchise partners, this move serves as a strong launchpad for our expansion in the state. Establishing Scientific Pathology in Agra as our regional reference lab will enhance capabilities, scale access through a structured franchise model, and introduce our specialized test portfolio,” said Metropolis CEO Surendran Chemmenkotil.
The acquisition is in line with Metropolis’ strategy to expand its footprint in areas where it doesn’t have a strong presence. At the time of acquiring Core Diagnostics, Metropolis chairperson Ameera Shah had told VCCircle that the company was “actively exploring” acquisitions. “We are considering smaller acquisitions in the northern and eastern regions of the country. In markets where our consumer brand presence is limited, acquiring a local leader could provide a strong platform for entry and growth,” she said.
Founded in 1984, Scientific Pathology operates three laboratories and 11 collection centers in Agra and nearby towns. The company gets 90% of its revenue from walk-in patients. In FY24, it recorded revenue of Rs 26 crore. In FY23, however, its revenue had declined to Rs 21.20 crore from Rs 26 crore in FY22.
Established in 1981, Metropolis is the second-largest diagnostics chain in India after Dr Lal PathLabs Ltd. It has a presence in over 700 towns and cities across 22 states and three Union Territories. It offers a range of over 4,000 tests, including advanced tests for the diagnosis of cancer, neurological disorders, infectious diseases, and various genetic abnormalities.
