IHH ready to invest Rs4,000cr at Rs160 per share in Fortis

Leslie Hanson
April 19, 2018

Four at last count, the last proposal was from China's Fosun Health Holdings, disclosed late on Tuesday night.

IHH Healthcare is fiercely competing with "bidders" trying to lure India's second largest hospital chain.

Manipal-TPG ahead in bidding race? Unlikely, says an industry representative familiar with the details. As informed earlier, the board of directors of the company is scheduled to meet on April 19, 2018 to consider all options, " Fortis said. Ltd. and TPG has sweetened is offered at ₹155 per share. Their bids do not reflect a long-term strategic intent, considering that they are sitting on much cash, points out a source.

Last week, Manipal Health Enterprises (MHEPL) had upped its merger offer by 21 per cent. Manipal first offered to buy Fortis last month in a deal that would combine its 14 hospitals with Fortis portfolio of 34 hospitals, creating a formidable rival to Apollo Hospitals Enterprise Ltd.

Manipal also offered to separately buyout 30.9 percent stake in SRL from existing private equity investors by paying Rs 1,113.4 crore.

Fortis Healthcare Ltd said on Thursday it has received an unsolicited binding.


"We believe that our improved offer is even more compelling, and is significantly better than any other options being explored by the company".

"The company has received an improved binding offer from Hero/Munjals and Burmans to invest directly into the company", Fortis Healthcare said in a regulatory filing.

The group said the infusion is meant to fund the buyout of the assets from RHT Health Trust as well as provide immediate liquidity towards working capital and infrastructure upgrades.

"We will invest an amount of (1) INR 500 crores through preferential issue of equity shares, and (ii) INR 1,000 crores through preferential issue of warrants; based on the current business and financial position of the Company as reflected in the Company's various public filings, and taking into account information in the public domain".

Board members and shareholders will be evaluating if Fortis' many suitors have what it takes to walk the path fraught with risk. Despite the due dilligence, there is still a "creepy feeling" of an unknown liability popping up from the Daiichi Sankyo-Singh brothers legal tussle taking place in different courts, says a person familiar with the transaction. IHH told Malaysian stock exchange that Fortis declined to engage with it citing its binding agreement with Manipal-TPG consortium, though Fortis refuted IHH statement saying it's Board is going to consider IHH bid as well. And Fortis's decision tomorrow will be key in unravelling who continues to dig in and participate in acquiring the hospital network and who decides to walk away.

Other reports by Iphone Fresh

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