Piramal Healthcare (Piramal), one of India's largest pharmaceutical and healthcare companies, and Super Religare Laboratories Ltd (SRL) have signed a definitive agreement under which SRL will acquire Piramal Diagnostic Services Private Ltd (PDSL), a subsidiary of Piramal. PDSL provides pathology and radiology diagnostic services through a network of 107 laboratories with FY10 revenues of over Rs 200 crore. As a result, SRL will have the largest network of pathology and radiology centers and will become the undisputed leader in the diagnostic services industry in the country.

This deal is valued at Rs 600 crore. Piramal will receive Rs. 300 crores on closing and the balance amount over a period of 3 years. Piramal will continue to be involved in the business, including by way of representation on the Board of Directors and the Executive Committee of SRL.

Complementing the strengths of both SRL and PDSL, the combined entity will have nearly 170 laboratories and 1500 collection centers and will serve more than 12 million customers annually. SRL's reach, brand recognition coupled with strong experience in managing hospital's implant labs will be complemented by PDSL's strong processes and systems, highly regarded pool of doctors and a robust, integrated service model covering both - pathology and radiology. The combined entity will be a distinct market leader in the highly fragmented Indian diagnostic services industry.

Commenting on the development, Ajay Piramal, chairman, Piramal Group said, "PDSL's network comprises of doctors of great repute and committed professionals who have built this business over the past decade. We feel it is the right time to take the business to the next level and this development will give it the scale and size to serve a much larger base of Indian customers with a high level of quality and care. This combination will go a long way in changing the diagnostic services landscape of not just India but also the Asia region."

Commenting on the development, Shivinder Mohan Singh, promoter of SRL Ltd. said, "We are very excited with this move as Piramal's strong talent pool, and integrated business model of pathology and radiology will add to our existing market leading position. This combination creates one of the largest and best in class service providers not just in India but also Asia, given our existing presence and relationships in the Middle East and SAARC countries. We believe this winning strategic combination will further enhance our platter of offerings and deliver superlative value and choice to our growing customer base."