‘It is unlikely Daiichi will have a say in the Manipalfortis deal’

MUMBAI:AFTER having made an offer to buy the hospital assets of Fortis Healthcare Ltd and seeking its board approval, Ranjan Pai is gearing up for the shareholders’ meeting, which is expected in a month.

Pai won’t mind some resistance and believes that current shareholders are free to sell their shares to anybody who can offer them a better deal. He will of course put his views forward. The Daiichi arbitration will not affect the sale process, Pai claimed, as that factor gets ruled out as the original Fortis promoters do not have a large shareholding. Edited excerpts from an interview:

How are you proposing to acquire it?

Like we have mentioned in our investor presentation and press release... What we are expecting is the demerger of the hospital assets from the existing Fortis, and that will then get merged with Manipal, which will also lead to listing of Manipal. All the shareholders of Fortis will also get a shareholding in Manipal.

So, the demerged entity will also be the listed entity?

Correct. It will be. So, there will be Fortis and there will be Manipal Fortis.

I am just trying to understand will it be a threestep transaction?

So, the announcement will be the demerger of the assets and merger with Manipal and then we will also buy 51% of SRL of which 20% will come from Fortis and 31% from the existing PE investors.

What will be the total deal value in terms money terms?

Manipal Education and Medical Group and TPG will invest ₹3,900 crore.

How much stake does it translate for you in the new entity?

Around 37-38%.

Do you anticipate any opposition from Daiichi or minority shareholders?

This has to be approved by all the shareholders. It will only happen if they vote for it. It is not relevant to this company anymore.

Have you reached out to Daiichi?

Daiichi, in this case, is not anymore there. It was there as long as the promoters had a large shareholding. Now that the promoters don’t have a large shareholding, it is unlikely that they will have any say in that.