Stay committed to patients in India and Fortis Healthcare, says IHH

Taking legal advice on next steps to pursue open offer for 26% stake in Fortis

The largest shareholder in Fortis Healthcare, IHH Healthcare on Tuesday informed the Malaysian bourses that they remained committed to the hospital chain and patients in India. 

"IHH remains as Fortis’ largest shareholder with a 31.1 per cent stake, and the judgment does not in any way alter our commitment to growing our healthcare operations and serving patients in India..." it said in a stock exchange notification. It added that IHH was obtaining further advice and was in discussions with relevant authorities for the mandatory tender offer to acquire an additional 26.1 per cent stake in Fortis. “IHH is obtaining further advice and is in discussions with relevant authorities to determine the next steps, in full compliance with all requisite regulations in India,” it said. 

Last week, the Supreme Court awarded six months’ jail to brothers Malvinder Singh and Shivinder Singh in the Daiichi-Fortis case and ordered a forensic audit of the Fortis-IHH deal. Disposing of Daiichi Sankyo’s plea, the apex court remanded the matter in the Delhi High Court, while continuing the stay on IHH open offer. 

"IHH Healthcare reaffirms our commitment to our patients in India, and to Fortis and IHH investors, that the Honourable Supreme Court has not found nor indicated any wrongdoing by IHH in terms of our investment into Fortis in its final order," IHH said in the notification to the stock exchanges.

It added that it remained “steadfast” in its ability and commitment to execute its business plans to grow its operations and serve the needs of patients in India, while “protecting the interests of our stakeholders”. 

“Over the last quarter and through the pandemic, Fortis has anchored its claim as one of the leading healthcare platforms in India and IHH is committed to stand firm on Fortis’ side to continue this growth journey,” IHH said.

IHH said the SC judgment supports its belief that its investment into Fortis was undertaken in a fair and transparent manner.

Malaysia’s IHH Healthcare had in 2018 acquired a 31 per cent controlling stake in Fortis by paying $1.1 billion in a bidding process overseen by an independent board. This set off an open offer to acquire another 26 per cent of Fortis shares from the market. The open offer was not pursued as Daiichi had filed a plea against it. The deal between Fortis and IHH was signed in August 2018. In December 2018, the SC stayed the IIH open offer.

Daiichi had challenged the Fortis-IHH deal to recover the Rs 3,600-crore arbitration award it had won in a Singapore tribunal against Fortis’ erstwhile promoters, brothers Malvinder Singh and Shivinder Singh.