Munjals-Burman team wins Fortis bid
NEWDELHI: Hero Enterprise chairman Sunil Munjal and Dabur chairman Anand Burman, who own a minority stake in Fortis, won the race to acquire hospitals chains of Fortis Healthcare Ltd after the firm’s board in a marathon meeting that ended late on Thursday decided by majority to recommend the binding offer of the Hero and Burman consortium.
As per the deal, the consortium will infuse ₹800 crore via a preferential allotment of equity shares at ₹167 per share or as per Sebi’s ICDR guidelines, whichever is higher and preferential issue of warrants of ₹1,000 crore at ₹176 per share or as per SEBI ICDR guidelines, whichever is higher.
“The recommendation of the Board would be placed before the shareholders for their approval,” the board said soon after the meeting.
The decision was taken following recommendations by an independent expert advisory committee (EAC) comprising Deepak Kapoor, former chairman of PwC India and Lalit Bhasin, chairman of the Indian Society of Law Firms, along with two financial advisers—Standard Chartered Bank and Arpwood Capital and Cyril Amarchand Mangaldas who were the legal advisers. “The board considered the views of the EAC, financial and legal advisers, and following extensive discussions arrived at this decision,” the board said.
The EAC had to decide between three offers, which have been made by TPG-backed Manipal Hospitals, Malaysia’s IHH Healthcare and a Sunil Munjal- led unnamed entity.
As per the evaluation process outlined by Fortis board, the EAC was to have an in-person meeting with bidders to understand the rationale and the justification of the offers made by all the parties that had submitted the binding bids. Standard Chartered was expected to present its independent recommendations to EAC.
Following this, the EAC was to form its own independent recommendation basis its own judgment and subsequently submit its final recommendation to the Board.
This will be followed by bidders making an in-person representation to the board, which would also get an independent recommendations from Arpwood, SCB and EAC, will recommend to shareholders its final decision regarding the Bid it feels is in the best interest for all shareholders.