Fortis Healthcare expresses inability to engage with IHH Healthcare owing to pact with Manipal Health Enterprises

Fortis Healthcare has expressed inability to engage with IHH Healthcare over its acquisition offer due to binding agreements with Manipal Health Enterprises

PTI April 16, 2018 14:51:54 IST
Fortis Healthcare expresses inability to engage with IHH Healthcare owing to pact with Manipal Health Enterprises

New Delhi: Fortis Healthcare has expressed 'inability to engage' with IHH Healthcare over its acquisition offer of up to Rs 160 per share due to binding agreements with Manipal Health Enterprises and party, the Malaysian firm said on Monday.

IHH had joined the race last week to acquire India's troubled Fortis, offering higher price than Manipal's Rs 155 a unit, which valued the company at Rs 6,061 crore.

In a letter to the Fortis board, IHH Healthcare Berhard Managing Director and Group CEO Tan See Leng expressed his company's "strong interest in Fortis Healthcare Ltd and its affiliates in a suitable manner".

Fortis Healthcare expresses inability to engage with IHH Healthcare owing to pact with Manipal Health Enterprises

Representational image. Fortis hospital's official website.

The Malaysian firm's offer came a day after Sunil Kant Munjal-led Hero Enterprise Investment Office and Burman Family Office offered to invest Rs 1,250 crore in the healthcare chain at up to Rs 156 per share.

Manipal had raised its offer for Fortis to Rs 155 per share by valuing the hospital business higher at Rs 6,061 crore, from Rs 5,003 crore initially.

In a filing on Malaysian stock exchange today IHH Healthcare said: "In response to the letter, the board of Fortis has indicated its inability to engage with IHH as Fortis has entered into binding agreements with Manipal Health Enterprises Pvt Ltd, Manipal Global Health Services and TPG Asia."

The company further said: "At this juncture, IHH has not entered into any discussions, negotiations or transactions."

In the letter last week, Leng said: "As on date, based on publicly-available information and our preliminary analysis, we believe a price of up to Rs 160 per Fortis share to be appropriate, subject to satisfactory completion of a due diligence."

Leng also hinted at the possibility of IHH making revised counter offer if the other suitors were to revise their bids.

"Notwithstanding anything in this letter, given the ever changing competitive dynamics, IHH reserves the right to pursue all necessary steps to ensure that the shareholders of Fortis are provided with the opportunity to realise the value inherent in our proposal including the right to revise the indicative offer price in any manner, IHH deems fit," he said in the letter.

In March, the Fortis board had approved demerger of its hospitals business, which was to be acquired by Manipal Hospitals and TPG Capital, along with the sale of 20 percent stake in diagnostics chain SRL Ltd, in a Rs 3,900-crore deal.

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