IHH has Rs 3,400 crore in escrow account for Fortis open offer, says CEO Tan See Leng

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Updated: March 2, 2019 6:12:47 PM

 CEO Tan See Leng, IHH, Malav Holdings, Religare Finvest, Best Healthcare, Fern Healthcare, This is in addition to the Rs 4,000 crore IHH has infused in FHL to acquire 31.1% in the latter through preferential allotment to become the single-largest shareholder.

Even as the Supreme Court has extended status quo order on the open offer of the IHH Healthcare to acquire another 26% stake in Fortis Healthcare (FHL), the Malaysian company has already set aside Rs 3,400 crore in an escrow account with an Indian bank for the process.

Also, to recover Rs 472 crore from firms that have taken inter-company loans from FHL, it has filed cases with the market regulator Sebi. “We have put in an additional Rs 3,400 crore in an escrow account in an Indian bank in preparation for the open offer,” said Tan See Leng, non-executive director of Fortis, and MD and CEO of IHH Healthcare, on Friday.

This is in addition to the Rs 4,000 crore IHH has infused in FHL to acquire 31.1% in the latter through preferential allotment to become the single-largest shareholder.

IHH plans to launch an open offer for shareholders of FHL, asking them to tender their shares at Rs 170 apiece and Sebi has approved the proposal. However, the apex court is hearing a plea of Japanese firm Daiichi Sankyo seeking to recover Rs 3,500 crore awarded to it by a Singapore tribunal in a case against former Ranbaxy and FHL promoters Malvinder and Shivinder Singh, and it has ordered the status quo. The next date of hearing of the case is March 14.

Clearing the air on the court issue, See Leng said IHH and FHL are not involved in the judicial proceeding between Daiichi and Singh brothers who now hold a meagre 0.16% in FHL. “They no longer have any part in Fortis or RHT,” he said.

FHL in January completed the acquisition of Indian clinics and hospitals held by Singapore-listed RHT Health Trust after missing the deadline twice.

“The RHT assets acquisition has given us cost savings as no longer need to pay clinical establishment fee and we expect to also improve financials through better cash flows,” he said.

“We are fully committed to the open offer as required as per the Sebi guidelines. We have high regards for the Indian judicial process and we certainly hope India will support foreign investors,” See Leng added.

The companies, which were given inter-corporate deposits allegedly by the Singh brothers to siphon off money from FHL, are RHC Holdings, Shivi Holdings, Malav Holdings, Religare Finvest, Best Healthcare, Fern Healthcare and Modland Wears.

However, See Leng clarified that the claims are against the companies which took the money. “Whatever the (Singh) brothers may have elsewhere is completely irrelevant. We will pursue the claims from the companies that took the money,” he said.

While the company has not got any response from Sebi yet, it will not hesitate to pursue all options available to get back the money. “We are exploring all options and seeking legal advise. We are also awaiting response from Sebi and we do not want to compromise the process,” said See Leng.

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