Munjal-burman team questions extension of Fortis bid deadline
MUMBAI: A day after the board of Fortis Healthcare Ltd granted more time to potential investors to send binding proposals, Sunil Munjal and the Burman family questioned the move, saying the bidding process was long over as per the original timeline.
“With regard to Fortis, we had assumed that the final bids have been submitted and only review to choose the best offer was pending. We were a bit surprised to learn that everyone has one more chance to bid/re-bid,” Sunil Munjal said in a statement on Sunday, also made on behalf of Mohit Burman and Anand Burman.
The statement also questioned an exclusive right that the TPG Capital-manipal Health Enterprises Ltd combine has to revise its offer within five days after the bidding is closed.
“We still welcome this move by the Fortis board; however, we strongly believe that there should be equal opportunity given to all bidders without any unfair advantage to any one party,” the statement said.
The Fortis board will now meet on May 10 to consider the recommendations of its external advisory committee (EAC), formed to evaluate the binding bids. The EAC will consider all binding bids made till May 1.
The board could not discuss the proposed bids on Thursday as scheduled earlier due to the resignation of Renuka Ramnath, a member of the EAC. She resigned a day before the committee was to table its report of recommendations to the board.
The Eac—chaired by Deepak Kapoor, former chairman & CEO, PWC India and Lalit Bhasin, president, Society of Indian Law Firms & managing partner, Bhasin & Co.—will now assess the binding bids and give their recommendations to the Fortis board by May 1.
The winning bid, once approved by the board, will need to be cleared by shareholders as well in an extraordinary general meeting (EGM) to be held on May 22.
“Our offer is already with the company; it’s the best one which is in the larger interest of Fortis Healthcare, and all those connected with the company’s ecosystem,” Munjal and the Burmans said.
“We are keen to invest directly in the company and believe this is the best way to create value for all stakeholders. We only hope that this process can be concluded quickly and efficiently...,” they added.
According to a person with direct knowledge of the matter, Tpg-manipal had first asked for a clause in the agreement with Fortis that would make it liable to get a “break-up fee from the winner” if the board decides to choose a third party instead of Tpg-manipal. The Fortis board resisted this proposal as this would have discouraged other potential bidders and agreed to give Tpg-manipal a right to revise their offer in five days from the date when bidding process ends.
The Fortis board, in its meeting that lasted till late Friday night, approved the appointment of Suvalaxmi Chakraborty, Ravi Rajagopal and Indrajit Banerjee as additional independent directors.