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IHH makes non-binding offer for Fortis Healthcare
KV Prasad Jun 13, 2022, 06:35 AM IST (Published)
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Summary
Malaysia-based IHH Healthcare Bhd has taken the plunge and made a much anticipated counter offer for Fortis Healthcare, according to sources, as the fight for Fortis Healthcare intensified. IHH reached out to the Fortis board last evening with a non-binding offer. The company is looking to conduct a due diligence to give a definitive bid to …
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Malaysia-based IHH Healthcare Bhd has taken the plunge and made a much anticipated counter offer for Fortis Healthcare, according to sources, as the fight for Fortis Healthcare intensified.
IHH reached out to the Fortis board last evening with a non-binding offer. The company is looking to conduct a due diligence to give a definitive bid to buy Fortis Healthcare.
The Fortis Healthcare stock gained in trade on the back of the counter offer. Sources said, given that, IHH has proposed to buy Fortis for around $1.3 billion, the share price is likely to be up to Rs 160/share.
IHH’s offer is at a premium to the binding bid given by Manipal Hospitals backed by PE firm TPG.
When contacted, Fortis Healthcare declined to comment.
An IHH spokesperson also declined to comment. “We decline to comment. We will make appropriate announcement(s) should there be any material developments.”
IHH’s offer to buy Fortis Healthcare comes soon after Manipal Hospitals sweetened its offer to make the deal palatable to the shareholders of Fortis Healthcare.
Reports suggest that East Bridge Capital, along with other minority shareholders, had opposed the original deal announced by Fortis and Manipal.
IHH’s investments in India:
IHH was the second largest shareholder in Apollo Hospitals, with a 10.85% stake in the company, and had invested $44.23 million into the healthcare company in 2005.
By May 2017, however, IHH exited the entire investment in Apollo with returns of $288 million, an amount worth about six times its initial investment. The company maintains two joint-venture facilities with Apollo in Kolkata and Hyderabad.
In April 2005, IHH had taken a majority stake in Continental Hospitals, a 750-bed super specialty facility, for Rs 300 crore. It was the first direct acquisition for IHH in the country.
IHH also acquired a 73.4% stake in the Hyderabad-based Global hospitals for Rs 1,284 crore, in August 2015 . Global has around 5 hospitals in Hyderabad, Mumbai, Bengaluru, and Chennai, with a total of about 1100 beds.
Ironically, IHH had acquired the Parkway Pantai Group, the crown jewel in its investments abroad, after a prolonged battle with Fortis.
Globally, IHH has around 8,000 beds across 45 hospitals in 10 countries. The company merged all healthcare assets, including Pantai in Malaysia, before public listing in 2012.
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