Fortis Healthcare sets up advisory panel to evaluate proposals

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Mumbai, April 19 (IANS) Fortis Healthcare on Thursday decided to constitute an “expert advisory committee” to evaluate all binding proposals for fund infusion.

The company’s Board in a regulatory filing with the BSE said while evaluating all the offers from suitors such as Hero Enterprise-Burman Family, Fosun Health Holdings, IHH Healthcare Berhad and Manipal Hospital Enterprises approved the constitution of the panel to “oversee the evaluation process and function as an advisor”.

As per the filing, the committee has “been requested to provide a report of its recommendation to the Board, by April 26, 2018, and will be chaired by Deepak Kapoor, Former Chairman and CEO of Price Waterhouse Coopers, India”.

The panel is likley to meet by April 25 to decide on the merger or buy offers, Brian Tempest, Director of Board, Fortis Healthcare, said in a conference call following the Board meet.

“The Board is scheduled to meet on April 26, 2018 to decide the further course of action. Standard Chartered Bank, the company’s financial advisors has been directed to assist the expert advisory committee and the Board,” the BSE filing said.

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Tempest also clarified that there was no proposal from KKR-backed hospital chain Radiant Lifecare as was widely speculated.

Earlier in the day, Fortis Healthcare informed the BSE in two separate filings, that its Board has received two improved binding offer to invest in the company from Hero Enterprise Investment Office and the Burman Family Office as well as IHH Healthcare Berhad.

The new binding offer from Hero Enterprise Investment Office and the Burman Family Office entails an investment of Rs 1,500 crore directly in the company and will replace the original offer made to the Board on April 12, 2018.

On April 12, 2018 Hero Enterprise promoted by Sunil Munjal and the Burman family offered to invest Rs 1,250 crore directly in Fortis Healthcare.

After the board meet Sunil Kant Munjal, Chairman, Hero Enterprise said: “We are pleased to note that the Board of Fortis Healthcare has found merit in our offer, which is simple, binding and is the quickest to implement. We believe that our offer is the most compelling, and is significantly better than any other options being explored by the company. We believe that this is the only offer which is in the best interest of all stakeholders of Fortis.”

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In a separate stock exchange filing to the BSE, Fortis said that it has received a “supplemental proposal” from IHH.

On April 14, the company reported that it has received EoI from IHH Healthcare Berhad for possible due diligence and participation with the company.

The IHH in its letter to the company’s Board on April 11, 2018 made an offer of Rs 160 per Fortis share.

On Thursday, Fortis Healthcare’s shares closed trading at Rs 148.45 per share, up 2.66 per cent at the BSE.

Besides IHH, Fortis Healthcare has received “an unsolicited non-binding expression of interest (EoI)” from Fosun Health Holdings for a possible due diligence.

Fosun Health Holdings, in its letter to the company’s Board, made an offer of a “primary infusion at a price up to Rs 156 per share, subject to due diligence to be completed within three weeks, up to a total investment of $350 million” including a preliminary investment of up to Rs 100 crore.

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However, Fortis Healthcare on March 27 had announced plans to demerge its hospitals business (Fortis Hospitals) into Manipal Hospital Enterprises Private Ltd (Manipal Hospitals).

The company at that time said the proposed transaction is subject to shareholders’ approval, creditors’ approval, applicable regulatory approvals (including Competition Commission of India, SEBI, stock exchanges and National Company Law Tribunal (NCLT)) and other customary conditions precedent.

The company’s board has also approved the sale of its 20 per cent stake in SRL Ltd to Manipal Hospitals.

–IANS

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