Strong fi­nan­cial po­si­tion al­lows firm to act when op­por­tu­ni­ties arise, says MD

New Straits Times - - Business | News - OOI TEE CHING KUALA LUMPUR bt@me­di­aprima.com.my

IHH Health­care Bhd, Asia’s largest pri­vate health­care group, is keep­ing mum about re­ports that it may buy In­dia’s sec­ond-largest hos­pi­tal chain, Fortis Group.

“We don’t com­ment on spe­cific deals,” said IHH man­ag­ing di­rec­tor and chief ex­ec­u­tive of­fi­cer Dr Tan See Leng.

“Our strong bal­ance sheet and fi­nan­cial po­si­tion al­low us to take ad­van­tage when op­por­tu­ni­ties arise,” he said af­ter a share­hold­ers meet­ing, here, yes­ter­day.

The Eco­nomic Times of In­dia re­ported yes­ter­day IHH had emerged as the front-run­ner for the con­trol­ling stakes in the health­care as­sets of Malvin­der and Shivin­der Singh of Reli­gare En­ter­prises Ltd, who both hold 52.3 per cent in Fortis.

The other con­tender is a con­sor­tium of TPG and Gen­eral At­lantic.

The re­port said IHH’s ad­van­tage came af­ter it di­vested its en­tire stake in In­dia’s largest hos­pi­tal chain, Apollo Hos­pi­tals En­ter­prise Ltd, last week.

It is es­ti­mated that IHH — ma­jor­ity-owned by Khaz­anah Na­sional Bhd — gained US$290 mil­lion (RM1.24 bil­lion) from the Apollo di­vest­ment, or about twice of what it in­vested in 2005.

Fortis, which in­cludes SRL Di­ag­nos­tics, is val­ued at US$2.8 bil­lion.

IHH, a Malaysian–Sin­ga­porean pri­vate health­care group fo­cused on up­mar­ket health ser­vices, has ac­tiv­i­ties in the pri­vate hos­pi­tal and health sec­tor in Asia and the Mid­dle East, no­tably in Sin­ga­pore, Brunei, China, Hong Kong, Malaysia, In­dia and the United Arab Emi­rates.

On IHH’s in­vest­ment strat­egy in In­dia, Dr Tan said: “We in­tend to ex­pand our pres­ence fur­ther ge­o­graph­i­cally.”

He said the group had in 2015 made its niche in­vest­ments in In­dia’s Con­ti­nen­tal Hos­pi­tals and Global Hos­pi­tals.

In a note to in­vestors, Public In­vest­ment Bank has placed a “neu­tral” call on IHH and val­ued its share price at RM6.75.

The stock closed three sen lower at RM5.97 on Bursa Malaysia yes­ter­day.

The re­search house said IHH’s first-quar­ter net profit ended March dou­bled to RM470 mil­lion, in­clud­ing a RM313.4 mil­lion gain on dis­posal of 6.07 per cent stake in Apollo Hos­pi­tals.

Ex­clud­ing ex­cep­tional gain on the dis­posal and for­eign ex­change losses, IHH’s net profit fell 15 per cent to RM201.8 mil­lion.

IHH is also listed on the Sin­ga­pore Stock Ex­change.

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