Almost all top posts at Lanka Hospitals Limited, the successor to the earlier Indian managed Apollo Hospitals at Elvitigala Mawatha in Narahenpita and coming under the purview of the Finance Ministry after the new government coming into power, has continued to see changes. In an unexpected turn off events Lakith Pieris who was the Chief Executive Officer since it was re-launched as Lanka Hospitals, is reportedly preparing to take over as Group Managing Director of a competitor in the healthcare sector, Hemas Hospitals Limited.

Recently, Lakith Pieris informed the Colombo Stock Exchange that he is to resign from his Chief Executive Officer’s post at Lanka Hospitals Ltd. effective 31March 2015.

Finance Minister Ravi Karunanayake told www.adaderanabiz.lk yesterday (20 February) that Dr. Sarath Paranavithana is to be appointed the new Chairman of Lanka Hospitals. According to its website, Dr. Paranavithana is the Medical Director of Ceymed Healthcare Services (Pvt) Ltd. – a subsidiary of the prominent shipping conglomerate Ceyline Group of Companies.

The Finance Minister further added that a 13 member Board of Directors, including Dr. Paranavithana, Deputy Secretary of the Sri Lanka Mahabodhi Society Ven. Keeniyawala Palitha Thera and Dilani Lokuhetti have been nominated and would be announced within a few days.

One of the largest private hospitals in Sri Lanka, Lanka Hospitals was established in 2002 as the Apollo Hospital with investments from the Chennai based Apollo Hospitals Group on a plot of government owned land at Elvitigala Mawatha in Narahenpita.

Later, 30 per cent of shares of Apollo Hospitals owned shares in Lanka Hospitals Corporation were sold by the Indian Apollo Hospitals Limited in 2006 to Sri Lanka Insurance Corporation headed by prominent Lankan business magnate Harry Jayawardana for Rs. 1,456 million. While two minor shareholders too sold their shares of nearly 09 percent to Sri Lanka Insurance Corporation, the percentage of shares in Lanka Hospitals owned by Harry Jayawardana’s Stassen Group of Companies overtook the 80 per cent mark.
The prominent feature here is the Apollo Hospitals Group selling its shares and leaving the business at a period when this hospital was incurring losses. An examination of its financial reports reveals that during the June quarter of 2006 Apollo Hospitals was incurring a loss of Rs. 14.3 million.

However, in 2009, with the Supreme Court revoking the privatization of Sri Lanka Insurance Corporation and vesting its shares with the Finance Ministry, the ownership of Lanka Hospitals Corporation shares of Sri Lanka Insurance Corporation came into government hands.

Following this, the Board of Directors was dissolved and a new Board under the Chairmanship of then Defence Secretary Gotabhaya Rajapaksa was appointed.

In response to a question by www.adaderana.lk during the re-launching of Apollo Hospital as Lanka Hospitals, whether the hospital was indeed earmarked as a fallback for the overcrowding of war casualties of the Humanitarian Operation at state managed hospitals, then Defence Secretary Gotabhaya Rajapaksa said that Lanka Hospitals planned to reserve some of its beds for the military.

While explaining he said, “In time to come, we want to dedicate a certain number of beds to the soldiers. Though it is a government hospital managed like a private hospital, our main concern is our customer. It is a different person who comes here with a lot of worries and problems. Also, families come with a lot of concerns. That is why we want to be caring (referring to the tagline of the logo ‘Caring, Curing’). We have to think of that person’s concerns as our concerns so that he will not worry.”

Explaining further,Gotabhaya Rajapaksa said, "When a father comes in with a heart attack, if a son can walk out of a hospital with a happy smile - that is what we want to do - that is caring. As a hospital that has served for a long time, it has both plus and minus points. What is important is identifying our weaknesses and improving on them.”

Significantly, under the Chairmanship of then Defence Secretary Gotabhaya Rajapaksa, this hospital transformed itself into a profit earning entity. Reportedly, Gotabhaya Rajapaksa not obtained a salary for his services.

The Lanka Hospitals Board of Directors under the Chairmanship of Gotabhaya Rajapaksa comprised Ms. R.S. Cabraal, Vidyajothi Professor Dayasiri Fernando, Gamini Wickremasinghe, P.A. Lionel, Malvinder Mohan Singh, Shivinder Mohan Singh, Sunil Godwani, Bandula Wijesiriwardene, Nihal Jayatilleke and Kanishka Karunaratne.

Three Indian nationals were appointed to this Board to represent the 28.6 per cent shares of Lanka Hospitals owned by Sri Lanka Distilleries Corporation which were bought by the prominent Indian hospital group Fortis Healthcare Limited.

The number of Directors representing Fortis Healthcare Limited in the new 13 member Board of Directors for Lanka Hospitals appointed by the new Sri Lankan government is still not known.

According to the constitution of Lanka Hospitals, appointing three Directors to represent Fortis Healthcare Limited is not compulsory and even a lesser number could be appointed.

Currently, around 55 per cent shares of Lanka Hospitals belong to Sri Lanka Insurance Corporation while some 10 per cent is with the Bank of Ceylon. While some 28 per cent is held by India’s Fortis Healthcare Limited around 08 per cent more are with shareholders through the Colombo Stock Exchange.

There are some 8,500 shareholders of Lanka Hospitals through the Colombo Stock Exchange.

During the last quarter ending 30 September 2014 under the Chairmanship of Gotabhaya Rajapaksa, the total assets of Lanka Hospitals Group was Rs. 5.4 billion and the profits for the particular quarter was Rs. 57 million.

Lanka Hospitals recording a profit of Rs. 269 million within the first nine months of 2014 is another significant feature.