IHH Healthcare Bhd. is preparing to formally approach Fortis Healthcare with an offer for the hospital operator that will put it in competition with a TPG-backed consortium, people with knowledge of the matter said.
IHH, Southeast Asia's largest hospital operator, aims to send a letter to the Fortis board within the next couple of weeks about its plans to bid for the company, according to the people. The Kuala Lumpur-based company is contemplating a cash offer for Fortis, which has a market value of about $1.2 billion, the people said, asking not to be identified because the information is private.
It is currently discussing the potential level of the bid, the people said. If the approach is rejected by the Fortis board, IHH will consider taking its offer directly to the Indian company’s shareholders, according to the people.
It would be the latest twist in the Fortis saga, with India's fraud watchdog and stock regulator investigating the company after Bloomberg News reported the company’s founders took at least Rs 5 billion out of the firm without board approval. Brothers Malvinder Singh and Shivinder Singh have resigned from the company and have lost control of their shareholding due to mounting debt.
No final decisions have been made, and there's no certainty IHH will proceed with a formal bid, the people said. A representative for IHH declined to comment, while a spokesman for Fortis said he couldn’t immediately comment