IHH Healthcare clarifies no collusion with Fortis founders

KUALA LUMPUR: IHH Healthcare Bhd says it has at no time dealt or colluded with embattled hospital chain Fortis Healthcare Ltd founders Malvinder Mohan Singh and Shivinder Mohan Singh or any entities related to them in its acquisition of a 31.1 per cent stake in Fortis.

This came in light of Supreme Court of India’s ruling on November 15 that held the the two founders guilty of contempt and said it could start similar proceedings against Fortis.

IHH, however, clarified that the 31.1 per cent subscription was undertaken in a fair and transparent manner, after obtaining the requisite corporate and regulatory approvals and in accordance with all applicable laws.

“The board further states that the subscription was undertaken and completed after Malvinder Mohan Singh and Shivinder Mohan Singh were no longer in control of Fortis,” it said in a filing to Bursa Malaysia.

“IHH has at no time dealt with nor colluded with both founders or any entities related or controlled by them in relation to the subscription.”

IHH said the Fortis open offer as well the Malar open offer would not proceed for the time being because of the judgment by the Supreme Court.

IHH remains committed to proceeding with the Fortis open offer once the stay was lifted by the Supreme Court, it added.

“The next hearing date for this matter is February 3, 2020. IHH is seeking appropriate legal advice on this matter and will subsequently decide on the future course of action,” IHH said.

Meanwhile, analysts do not expect the Supreme Court refusal to remove a barrier to the Fortis takeover to affect IHH or Fortis significantly.

“Overall, we are relatively neutral on the said news. If the Supreme Court decides that IHH cannot proceed with the mandatory takeover offer of Fortis, IHH is still the single largest shareholder having five nominated members on Fortis board,” Hong Leong Investment Bank said.

“If there is any potential fine, it is miniscule. The spill over risks, if any, will be more reputational in nature, we reckon,” it added.

Source: NST