Malaysia-based IHH Healthcare Berhad is all set to give a voluntary open offer sometime soon to buy the non-promoter shares of Fortis Healthcare Ltd.
In June 2017, the healthcare company had walked out of the bilateral talks with the Singh brothers, who were then controlling Fortis.
A Voluntary Open Offer is an open offer given by the acquirer voluntarily without triggering the mandatory open offer obligations.
The offer draws significance as competitor TPG-Manipal Hospitals group are also trying to get a minimum holding of 51% in the healthcare company. Currently, original promoters of Fortis hold less than 1% of the company - 0.77%. The current market cap of Fortis is Rs 7,909.52 crore.
IHH has tied up with investment bank Citi for this deal and is setting a whopping $1 billion fund for the share purchase. Manipal is believed to be working with Kotak Mahindra for the deal.
Mumbai-based private lender YES Bank is the single largest shareholder with a 17.03% stake in Fortis. Rest of the shares in the India's second-largest private hospital chain are divided among public and other institutions.
IHH, which controls the Parkway Pantai chain of hospitals, will not seek the promoters' shares for now, the Economic Times reported citing sources.
Law firm Luthra and Luthra, which was roped in by the board-run company's audit and risk-management committee, is expected to table a report on Fortis's treasury operations, inter-group and related-party transactions, allegations of the Singh brothers siphoningoff money, and other clauses. Previously, auditor major Deloitte said it cannot comment on the company's financials.
Following the reports of IHH share purchase, shares of Fortis Healthcare jumped as much as 5.5 per cent, its biggest intra-day percentage gain since February 23. Fortis shares have fallen 14.4 per cent in last one year.