Fortis close to buying 10 Wockhardt hospitals

Deal worth Rs 1,000-1,200 crore likely in a few days.

Fortis is reportedly close to acquiring 10 hospitals of healthcare major Wockhardt for up to Rs 1,200 crore and an announcement could be made anytime now.

A deal could be signed in next few days, sources in the know of the development said. When contacted, Wockhardt Chairman Habil Khorakiwala said: “We are still talking to two parties and we have not finalised anything yet.”

Declining to comment on the proposed deal, Fortis Healthcare CEO and Managing Director Shivinder Mohan Singh said, “We do not comment on market speculations.” The sources, however, said the deal would be in the range of Rs 1,000-1,200 crore and include 10 hospitals — three in Kolkata, two in Mumbai and five in Bangalore. Market speculations suggested a deal had already been clinched with Wockhardt agreeing to sell five of its own hospitals — in Mumbai, Bangalore and Kolkata for about Rs 1,000 crore. It was not clear how the Wockhardt management would utilise the funds raised from the sale of the hospitals. The deal was necessitated due to the debt burden of Wockhardt group’s flagship firm Wockhardt Ltd. The pharma business of the company has been undergoing corporate debt restructuring to reschedule loans of about Rs 3,700 crore. The pharmaceutical company had registered huge losses on derivatives and high interest burden. The deal is expected to bail out Wockhardt Ltd from its current financial crisis.

“The hospitals business is not a part of the listed (pharma) company,” Khorakiwala said. On whether promoters will utilise the money raised from the sale of hospitals to retire debts, he said, “The details of all these things have not yet been finalised.”

Fortis said it will not comment on market speculation.