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Fortis shareholders need objective advise on buyout offers: Report

Press Trust of India  |  New Delhi 

Healthcare shareholders need an objective and independent decision-making body to advise its board on the company's sale, which has received three bids, proxy advisory firm said today.

Currently, there are three offers, which are extremely diverse, it said in a report.

The offers are from Manipal Health Enterprises, a joint one by and and Malaysia's

In a report, 'Sholay, Satyam and Healthcare', said the focus should not be on the similarities in their misconduct, but drawing on the solution that Satyam was offered.

"While the current situation at is unfolding in as dramatic a fashion as Sholay (Hindi movie) did, its fall from grace is perhaps similar to that of Satyam Computer Services," it said,

The decision on which bid to accept cannot be driven by valuation alone as there are questions regarding subsequent control and the issues regarding the current promoters' need to be dealt, it added.

According to the report, all the three options have very different consequences for the future of Fortis and taking the right call will now be crucial.

believes the current board can get additional support in assessing the three bids and coming to a decision among the complex sets of pulls and pressures, without necessarily waiting for board expansion.

"As an alternate to expanding the board, the company must appoint a special committee to the board, that will advise the board on the sale," it said.

"The committee should be tasked with evaluating the bids and structures, narrow in on the most suitable buyer and negotiate the final contours and terms with the chosen buyer," it added.

As per the report, "shareholders need a decision-making body that is objective, independent, and does have a historical association with the promoter group or their companies".

Institutional shareholders can suggest names for committee membership, either directly or collectively.

The first offer for Fortis is from that wants to separate the hospital business from the diagnostic and create two listed entities.

The second one is a joint offer from and Burman Family Office, which plans to pump in additional cash, and leave the business to run as-is-where-is for now. In addition, the third one is from that has proposed to take over Fortis.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Mon, April 16 2018. 18:45 IST