Manipal's revised offer for Fortis falls short of Street's expectations

Value of the hospital business is lower than Street's expectations

Private equity firm TPG backed-Manipal Hospitals has sweetened the offer to acquire the hospital business of Fortis Healthcare to address the valuation concerns of the latter’s shareholders, but it is still short of the Street’s expectations.

Earlier, the equity valuation of Fortis’ hospital business was pegged at Rs 50.03 billion. It has been revised upward by 21 per cent, or Rs 10.58 billion, to Rs 60.70 billion. At the revised level, it is nearly the same as Manipal Hospitals’ equity valuation. Fortis’ shareholders, who were earlier offered 10.83 shares in the merged entity for every 100 shares held in Fortis,