The Supreme Court’s order allows lenders to sell shares pledged by the Singh brothers – clearing one of the major hurdles blocking the possible sale of the company.
The Supreme Court on Thursday lifted the stay on sale of pledged shares held by Fortis promoters, the Singh brothers.
The order allows lenders to sell shares pledged by the Singh brothers – clearing one of the major hurdles blocking the possible sale of the company.
However, the stay on sale will continue - for shares encumbered after August 11, 2017.
The order saw the company's stock snapping intraday losses, ending 0.84 per cent at Rs 143.70 on BSE.
As on March 2017 – 85.78 percent of the shares were pledged by Fortis Healthcare Holding Private Ltd (FHHPL) the promoter holding company of Fortis Healthcare.
FHHPL is owned by Malvinder Singh and Shivinder Singh referred as Singh brothers.
The promoter’s stake in Fortis has fallen from 70.28 percent as on September 30, 2016 to 34.43 percent as on December 31, 2017.
The Supreme Court in September last year restrained the Singh brothers from disposing any of their assets both encumbered and unencumbered until the final disposal of the case.
It also refused permission to banks with whom the Singhs have pledged Fortis shares to do the same.
Axis and Yes Bank, the major lenders, moved Supreme Court seeking vacation of the stay in order to allow them to sell pledged shares.
Singh brothers had pledged shares worth Rs 1,580 Cr and Rs 390 crore with Yes Bank and Axis Bank respectively.
Japanese drug maker Daiichi Sankyo filed a petition on August 10, in the Apex Court challenging the Delhi High Court order that gave nod to Singh brothers to sell their stake in Fortis.
Daiichi claimed that it would face “irreparable loss” if the promoters’ stake in Fortis were to be sold, as it would affect its recovery of an international award it won against the Singhs last year.
A Singaporean tribunal had adjudged in favour of Daiichi that the Singh brothers had concealed information about Ranbaxy regulatory problems with US FDA, while selling its shares.
Since then, Daiichi and the Singhs have been locked in litigation over the enforcement of the Singapore court’s award.Last month, the Delhi High Court had allowed Daiichi to collect Rs 3,500 crore (USD 500 million) award money from the Singh brothers.