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Fortis Healthcare seeks legal advice after Supreme Court orders forensic audit in its share sale

New Delhi, September 22, 2022

The Supreme Court on Thursday awarded six months jail term to former promoters of Fortis Healthcare Ltd

Fortis Healthcare on Thursday said it is seeking legal advice to decide its future course of action after the Supreme Court ordered a forensic audit of its share sale to Malaysia’s IHH Healthcare.

Similarly, IHH Healthcare also said it is awaiting the written judgment from the apex court and seeking legal advice on the impact of the order on its acquisition of Fortis Healthcare.

In a regulatory filing, Fortis Healthcare said the proceedings before the Supreme Court have “concluded with certain directions and the suo motu contempt has been disposed off. We are seeking legal advice to decide our future course of action.”

IHH Healthcare, in a separate statement, said it has been advised by its Indian counsel to wait for the written judgment before announcing the decision of the Supreme Court.

It is in the process of obtaining the written judgment from the Supreme Court of India and “seeking legal advice on the impact thereof on the transaction”.

“Further announcements regarding the Fortis open offer and the Malar open offer will be issued after receipt of the copy of the said judgment,” it said.

The Supreme Court on Thursday awarded six months jail term to former promoters of Fortis Healthcare Ltd., Malvinder Singh and Shivinder Singh, in a case related to the sale of shares of Fortis to Malaysia-based IHH Healthcare.

The apex court also ordered a forensic audit of the share sale in Fortis Healthcare Ltd.

In December 2018, the Supreme Court had ordered status quo with regard to the sale of controlling stakes of Fortis Healthcare to IHH Healthcare Berhad by former Ranbaxy promoters and hospital operators — Malvinder Singh and Shivinder Singh.

The apex court was hearing the plea of Japanese firm Daiichi Sankyo which was seeking to recover ₹3,500 crore, awarded to it by a Singapore tribunal in its case against Singh brothers.

The apex court’s order put on hold IHH’s open offer for an additional 26% stake in Fortis, which was scheduled to commence on December 18, 2018 and close on January 1, 2019 entailing a total sum of ₹3,300 crore.

The proposed open offer was subsequent to IHH clinching a Rs 4,000-crore deal to acquire 31.1 per cent stake in Fortis Healthcare in July 2018. IHH had pipped rival Manipal-TPG combine in the race.

Fortis Healthcare shares on Thursday ended 14.75% down on BSE at ₹265.3 apiece.

[The Hindu]

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