Indian healthcare tycoons Malvinder Singh and Shivinder Singh are set to divest management control in all their key businesses ranging from their hospital chain, Fortis Healthcare, financial firm Religare Enterprises, health insurance, etc, to tide over the cash crunch at the group level, a media report said.
The Singh brothers will raise around Rs 5,500 crore through multiple transactions and retain significant minority stakes in most of these businesses and continue as investors in them, the Economic Times reported.
“The brothers have decided to sell management control in Fortis Healthcare, Religare Health Insurance and Religare Securities and eventually in Religare Enterprises, the holding company for the non-banking finance business,” the Economic Times quoted an official aware of the development as saying.
“The group is expected to sign binding agreements separately for three transactions in the next two months,” said the official who did not want to be identfied.
“The entire proceeds from these transactions will be used to fuel the brownfield growth of the hospital network as also pay for the transaction with the business trust in the last quarter (besides) bolstering the net worth of the non-banking finance company (NBFC), which has had to take some write-offs due to bad loans in the recent past.”
The group holding company RHC Holding Pvt Ltd, however, refused to comment on the matter.
Shivinder Singh had last year stepped down from the post of executive vice-chairman of Fortis Healthcare to work for the Radha Soami Satsang Beas (RSSB), a spiritual organisation with a large following in northern India.