New Delhi: As the fate of Fortis-IHH deal hangs in balance, all eyes are now at the next hearing in the Supreme Court on status quo is scheduled on March 14, 2018. H Tan See Leng, CEO of IHH in the meantime came out in public the organisation’s firm belief in the Indian Judicial process.
IHH and Fortis are not involved in the dispute between Daiichi and the Singh brothers and are hopeful of a positive outcome on the status quo on the open offer in the next hearing in the Supreme Court scheduled on March 14, a top Malaysian firm official said Friday. The Supreme Court had earlier extended status quo order on the open offer of the IHH to acquire 26 per cent stake in Fortis to the next hearing.
“We firmly believe in the Indian judicial process and will respect any decision made by the Supreme Court of India. IHH will seek advice from our legal counsel and explore all options available to us,” Fortis Non-Executive Director and IHH Healthcare Berhad MD and CEO Tan See Leng told reporters here in a video conference.
As the single largest shareholder, IHH remains committed to active participation in Fortis and looks forward to the speedy resolution of this matter, he added.
“We hope that India will support foreign investors and that minority shareholders in Fortis will have their chance to realise the value of their investment through this open offer opportunity, which has been delayed,” See Leng said.
The judicial proceedings solely pertain to the Singh brothers who now hold a very negligible shareholding in Fortis, he added.
The apex court is hearing the plea of Japanese firm Daiichi Sankyo which is seeking to recover Rs 3,500 crore, awarded to it by a Singapore tribunal in its case against former Ranbaxy and Fortis promoters Malvinder and Shivinder Singh.
Emphasising that efforts are continuing to improve the performance of Fortis, See Leng said in the meanwhile efforts by the IHH and Fortis leadership on restoring the performance of Fortis Healthcare continues unabated.
“We are very excited to be moving on to the next phase of our strategy under the fresh Fortis leadership,” he added.
IHH is already the single largest and the controlling shareholder in Fortis post the successful acquisition of 31.1 per cent stake in the company through a preferential allotment that closed on November 13, 2018 and “we immediately infused Rs 4,000 crore in Fortis to stabilise the business,” See Leng said.
“We have also put around Rs 3,400 crore in an escrow account in a local Indian bank. This total of around Rs 7,400 crore is we believe the largest foreign direct investment in hospital and healthcare in India,” he added.
The moment the Supreme Court removes the status quo, the open offer can proceed, See Leng said.
Earlier in a regulatory filing in December 2018, IHH had said that in the light of the Supreme Court of India’s order directing “status quo with regard to sale of the controlling stake in Fortis Healthcare to Malaysian IHH Healthcare Berhad be maintained”, it will not be able to proceed with the Fortis open offer for the time being.
The open offer for an additional 26 per cent stake was scheduled to commence on December 18 and close on January 1, 2019.
Clarifying that Singh brothers had no role in the RHT Health Trust (RHT) acquisition, See Leng said: “Daiichi and Singh brothers do not have any role to play in the recent RHT acquisition.”
The RHT transaction is beneficial and will be value accretive for the Fortis and its shareholders as it would save significant clinical establishment fees, he added.