Fortis takeover saga: Board considers Munjal-Burman’s joint offer

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Takeover saga of Fortis Healthcare Ltd finally came to an end on Thursday after its board of directors accepted an investment offer from the Hero-Burman consortium to acquire stake in the cash-strapped hospital chain.

The Fortis board approved a joint offer made by Hero Enterprise Investment Office and the Burman Family for an upfront equity infusion of Rs 800 crore. Sunil Munjal-led Hero Enterprise and Dabur’s Anand Burman and Mohit Burman had offered a price of Rs 167 per share through preferential allotment on May 1.

In a late-night filing to the BSE Fortis Healthcare Ltd said the Munjal-Burmans has agreed to invest another Rs 1,000 crore via preferential issue of warrants priced at Rs 176 per share.

A statement released from the Fortis board said, “The Board, post having the detailed discussions on the pros and cons of each offer, decided by majority, to recommend the offer of Hero Enterprise Investment Office-Burman Family Office.”

Responding to the latest development, Sunil Kant Munjal said: “We are delighted that the board has accepted our offer, which is, unarguably, the best solution.”

“We are sure that the shareholders will see the intrinsic value in our proposal and repose confidence in us. As long-term investors, we are committed to help make Fortis the finest healthcare institution in the region, and create value for all stakeholders,” he further stated.

“Going forward, the immediate plan of action for the company should be to build on its strengths, retain talent, expand business and institutionalise processes at Fortis,” Anand Burman, Chairman of Dabur India said on the takeover deal.

With the deal went into the lap of Munjal-Burmans, month-and-a-half-long bidding war comes to an end. There were five entities-KKR-backed Radiant Life Care, IHH Healthcare, Manipal/TPG consortium, Fosun Health Holdings and Munjal and Burman family offices, which were in the race to acquire stakes in Fortis Healthcare. Except Fosun Health, four had made binding offer.

On 6 May, Manipal Health Enterprises had revised its offer for Fortis Healthcare Ltd (FHL) again, raising the value to Rs 8,358 crore.

Earlier on 24 April, MHEPL and TPB combine had revised their offer for Fortis raising the value to Rs 6,322 crore. The earlier revised offer of 10 April valued Fortis hospital business at Rs 6,061 crore.

The consortium, which is the first to make a binding offer to Fortis, had initially valued the hospital business of the healthcare chain at Rs 5,003 crore in its offer on 27 March.

Starting from first hospital at Mohali in 200, Fortis Healthcare has grown to be a leading healthcare provider in India.

Currently, the company has 45 healthcare facilities (including projects under development), around 10,000 potential beds and 314 diagnostic centres in India, Dubai, Mauritius and Sri Lanka.

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