Fortis board meet today: The battle to pick up a controlling stake in Fortis intensified as suitors Manipal-TPG, Malaysia’s IHH and KKR-backed Radiant Life submitted revised bids ahead of the hospital chain’s board meeting on Thursday. The revised bids come after the Fortis board recently clarified that it will consider only binding bids. Meanwhile, Manipal-TPG has raised its offer for the second time. The other major bidder- the Burmans and the Munjals have also made an improved binding offer which to invest Rs 1,500 crore directly into Fortis, as compared to their earlier offer of Rs 1,250 crore. We take a closer look at the revised bids-
Manipal-TPG’s latest offer values Fortis Health’s hospital business higher at Rs 6,322 crore, as compared to Rs 6,061 crore earlier. According to the revised terms, Manipal Health Enterprises (MHEPL) has proposed to arrange financial assistance of up to Rs 750 crore by way of debt financing or guarantees to lenders of FHL. “MHEPL has offered a premium of Rs 1,319 crore to the FHL shareholders over and above the FHL Hospital’s Business’ equity valuation of Rs 5,003 crore, as determined by the independent valuer and certified by category 1 merchant banker,” the revised offer document said.
In its revised proposal, Malaysia’s IHH has submitted a binding offer to infuse Rs 6.5 billion, valuing Fortis at Rs 160 per share. Earlier, the healthcare giant had made a “non-binding expression of interest” and was willing to pay up to Rs 160 per share. According to IHH”s assessment, Fortis would need an equity infusion of around Rs 40 billion for working capital and buying the asset portfolio of RHT Health Trust. IHH’s offer has two components, a Rs 33.5 billion in Fortis through preferential allotment of shares and a non-binding offer for the second larger tranche. Further, the company has sought three weeks to complete due diligence.
KKR-backed Radiant Life Care
PE giant KKR backed Radiant Life Care has submitted a binding offer to pick up Fortis Healthcare Mulund hospital for an enterprise value of Rs 1,200 crore. According to Radiant, this will help Fortis to get immediate cash. Apart from picking up the Mulund Hospital, Radiant seeks to spin off of the diagnostic business. It has made a non-binding offer to acquire only the hospital business of Fortis at a valuation of Rs 126 per share. According to the currently available details, Radiant Life Care has sought a rights issue to fund the acquisition of assets from RHT.