New Delhi: Fortis Healthcare on Thursday said it has received an "unsolicited binding offer" from Hero Enterprise Investment Office and Burman Family Office to invest Rs 1,250 crore in the company through preferential allotment route, even as reports emerged that Kuala Lumpur-based IHH Healthcare has proposed a potential bid of as much as $1.3 billion (about Rs 8,450 crore) that tops an offer from Manipal Health Enterprises.
A Bloomberg report, citing sources, said IHH Healthcare, Asia’s largest hospital operator, sent a letter to the Fortis board on Wednesday saying it may be willing to pay as much as Rs 160 per share to acquire control of the company. It has asked the Fortis board for some time to update its due diligence before making a formal bid for the company in which group entities of Hero Enterprise Investment Office led by Sunil Kant Munjal and the Burman family of the Dabur Group hold around 3 per cent stake.
In a regulatory filing, Fortis Healthcare (FHL) said the offer from Munjals and Burmans includes a Rs 500 crore binding offer immediately and Rs 750 crore post-diligence to be completed within three weeks.
"The said proposal is under evaluation by the company and we will keep the stock exchanges informed accordingly," it added.
Spelling out the details of their offer, the Munjals and Burmans in a joint letter said, "We are investing an amount of Rs 500 crore based on current business and financial position of the company without doing any due diligence..."
Further, the letter said,"Allotment and pricing shall be as per Sebi ICDR guidelines for preferential issues or Rs 156 per share which is higher."
Utilisation of proceeds from this funding shall only be for the purposes of payment of employee dues, repayment of loans which have matured and payment of pressing creditors and to monitor these, a board seat shall be given to investors, it added.
The rest Rs 750 crore shall given after due diligence subject to the satisfaction of the investors which will be completed in three weeks, the letter added.
Their offer comes two days after Manipal Health Enterprises raised its offer for Fortis Healthcare by valuing the hospital business higher at Rs 6,061 crore which would result in a "more favourable share exchange ratio for shareholders of FHL".
Manipal said its revised plan gives Fortis shareholders Rs 155 per share in value, up from Rs 140 earlier.
Fortis shares gained 4.17 per cent to end at Rs 153.80 on the BSE on Thursday. Intra-day, the stock rose by 4.63 per cent to Rs 154.50.
The potentially competing bids are the latest twist in the Fortis saga, with the fraud watchdog and stock regulator investigating the company after media reports said the company’s founders took at least Rs 500 crore out of the firm without board approval. Brothers Malvinder Singh and Shivinder Singh have resigned from the company and have lost control of their shareholding due to mounting debt.
Manipal’s controlling shareholder Ranjan Pai on Wednesday said the reason he was not buying Fortis outright was because of the potential liabilities posed by the investigations. IHH is planning a cash offer for Fortis shares, people with knowledge of the matter said on Wednesday. If Fortis board rejects the approach, IHH will consider taking its offer directly to the company’s shareholders, according to the people.
IHH had engaged in talks early last year to invest in Fortis, people with knowledge of the matter said at the time.
