Manipal Health is likely to manage the hospital chain while TPG will invest in acquiring the network
TPG Capital-backed Manipal Health Enterprises (MHE) is close to take over Fortis Healthcare Ltd.
Sources told DNA Money that the deal, expected to be in the range of Rs 6,500 crore, is likely to be formalised early next week and an announcement may follow soon.
Other bidders in the fray were Abu Dhabi-based VPS Healthcare and IHH of Malaysia.
TPG already has an investment in Manipal Health Enterprises.
Sources said MHE is likely to manage the hospital chain while TPG will invest in acquiring the network. For over a year now, TPG, one of the globe's largest buyout funds, has been looking at the prospects on consolidating the two hospital chains -- Fortis Healthcare and Manipal Health Enterprises -- to create India's largest medical services group and also to come at par with its rival, Apollo Hospitals.
When combined, Fortis Healthcare and MHE will have an edge over Apollo, which has over 10,000 beds.
When contacted, Fortis said, "As a policy, we do not comment on market speculations. As shared earlier, the company is exploring options for fund raising." An email questionnaire sent to MHE did not draw any response.
On Thursday, Fortis shares closed at Rs 160.80, 0.6% higher compared to the previous day's close.
Fortis Healthcare on Thursday said it will hire an external legal firm to carry out an investigation into alleged siphoning of cash by the firm's promoters, Malvinder Singh and Shivinder Singh, according to news agency reports.
In its second and third quarter earnings statement, Fortis said its Audit and Risk Management Committee "decided to carry out an independent investigation through an external legal firm". "The scope of the investigation, inter alia, covers (a) inter corporate deposits (ICDs) given by a wholly owned subsidiary of the company; (b) intra-group and related party transactions, including compliance with applicable laws and regulations," it said.
Fortis Healthcare on Thursday also reported a consolidated net loss of Rs 19.10 crore for the quarter ended December 2017 against a profit of Rs 453.29 crore in the year ago period.
The company also reported its September quarter net loss at Rs 23.61 crore after it had sought a 15-day extension to declare earnings for the second and third quarter of the current financial year citing statutory auditors' inability to complete the audit before the stipulated Board meeting.
Although the company presented its earnings report, the auditor to Fortis Healthcare, Deloitte Haskins & Sells LLP, said it had not performed an audit.
It said the interim results have been reviewed by other auditors whose report has been furnished to them by the management.
"Because of significance of the matters... relating to the ongoing investigations... we were not able to obtain sufficient appropriate evidence to form a conclusion on the statement," it added.
Established in 1996, by Parvinder Singh, with its first hospital at Mohali (Chandigarh) that opened in 2001, Fortis owns and operates over 55 healthcare facilities -- hospitals, diagnostics and day care specialty facilities -- across the country. These include the Escorts Heart Institute and the erstwhile Wockhardt facilities (earlier acquired by Fortis).
NURSING IT BACK
- Manipal Health is likely to manage the hospital chain while TPG will invest in acquiring the network
- When combined, Fortis and Manipal Health will have an edge over Apollo, which has over 10,000 beds
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