Fortis Healthcare plunges 14% on buzz of IHH pulling out of deal talks
Malaysia-based Integrated Healthcare Holdings (IHH) reportedly has pulled out of controlling stake purchase talks from Fortis Healthcare, Malar Hospitals and SRL Diagnostics.
June 23, 2017 / 03:19 PM IST
Shares of Fortis Healthcare fell about 14 percent intraday on Friday on reports of Malaysia-based Integrated Healthcare Holdings (IHH) pulling out of controlling stake purchase talks from Fortis Healthcare, Malar Hospitals and SRL Diagnostics.
IHH, according to a report in The Economic Times, had been in exclusive negotiations with the Singh brothers, Malvinder and Shivinder, to acquire a controlling interest in Fortis Healthcare and Fortis Malar and SRL Diagnostics.
Interestingly, business daily Mint had earlier reported that IHH is close to finalizing the deal by paying around Rs 3,600 crore for a 26 percent stake in Fortis.
The company last week said in a filing to stock exchanges that it is still evaluating the best possible ways to raise funds and no firm decision in this regard has been approved by the board till date.
Fortis board had approved enabling of fund-raising options up to Rs 5,000 crore including but not limited to qualified institutional placement, foreign currency convertible bonds or any other method.
The stake sale is facing hurdles from Daiichi Sankyo, as the Japanese drug maker says that the Singh brothers' exit from Fortis Healthcare would hamper recovery of damages of Rs 2,562 crore awarded by a Singapore tribunal to the drugmaker.
In April, Daiichi moved Delhi High Court to block a sale in Religare Health Insurance Company Limited by the Singh brothers to investors affiliated with the equity firm True North. This caused the High Court to furnish details of all their unencumbered assets for future compensation.
The stock has fallen 11 percent in the past one month, while its three-day loss stood at 14 percent. At 15:15 hrs Fortis Healthcare was quoting at Rs 171.50, down Rs 26.45, or 13.36 percent on the BSE. It touched an intraday high of Rs 187.60 and an intraday low of Rs 170.90.