Fortis drags Khazanah to S'pore regulator

India's Fortis Healthcare today approached the market watchdog Securities Industry Council here alleging misleading of Parkway shareholders by Khazanah by claiming that majority of them have voted in favour of the Malaysian fund's partial offer.

A letter to the SIC by Fortis' legal representatives said the press release issued yesterday by Integrated Healthcare Holdings (IHHL), the arm of Khazanah, calls into question the purpose and intention behind it.

IHHL had said it has received the approval of the majority of eligible shareholders of Singapore-based hospital chain Parkway who have so far voted on its partial offer.

"This calls into question the purpose and intention behind the IHHL announcement ... Whether the intention is to put a positive spin and mislead shareholders into thinking that shareholders support the partial offer," the joint letter by Stamford Law Corporation and Rajah & Tann LLP on behalf of Fortis said.

The letter further said IHHL's statement gave an impression that the "latest development is a positive development for IHHL, when in reality both conditions to the partial offer remain unsatisfied".

"The majority obtained at that point in time only was a slim 0.5 per cent, with a significant portion (30 per cent) eligible shareholders yet to vote," it said.

Moreover, IHHL did not also indicate how many shareholders voted for the partial offer before Fortis' open offer on July 1, it said, adding "a significant portion of the votes might have been cast before" the open offer.

"This could mislead the market into thinking that the majority of the Parkaway shareholders had cast their votes in favour of the partial offer even when there was a competing (Fortis) offer," the letter said.

It also pointed out that after the press release by IHHL yesterday were "voluntarily made - there is no requirement under the Singapore code of takeovers and mergers for IHHL" to make the announcement.

Claiming that the announcement by IHHL affected trading of Parkway shares, the letter said "the volume of trading Parkway shares increased considerably" closing at 1.823 million shares traded for the day.

Fortis asked the SIC to ask IHHL to clarify and issue a public statement.

Khazanah and Fortis had been locked in a tussle to take control of Parkway. While the Malaysian fund launched a USD 835-million partial offer for a 51.5 per cent Parkway stake at SGD 3.78 a share, Fortis countered it with a USD 2.3-billion at SGD 3.8 per share to fully acquire Parkway.

Khazanah's partial offer is to close on July 26, while Fortis' will close on August 12. Fortis owns 25.37 per cent of Parkway, while Khazanah has a 23.32 per cent stake.