Fortis sees signs of recovery, shareholders approve IHH deal

BENGALURU: Cash-strapped Indian hospital operator Fortis Healthcare Ltd said yesterday it was starting to see some signs of recovery, as it secured shareholder approval for its takeover by Malaysia’s IHH Healthcare Bhd.

Fortis, which operates about 30 private hospitals in India, reported a net loss of 707.4 million rupees (RM41.5 million) for the three months ended June 30, and has now been in the red for five of the last six quarters, as it struggled with a cash crunch, rising debt and other problems.

However, it said occupancy rates at its hospitals had risen to over 69% currently, from 62% in the quarter through June.

The first quarter loss reversed a 52.9 million rupee profit in the same period a year earlier, and income from operations fell 9.9% in the first quarter from a year earlier to 10.4 billion rupees.

“...The last quarter performance has been impacted severely due to the continuing challenges that the company had been facing over the last 18 months that have led to liquidity issues,” chief executive Bhavdeep Singh said in a statement yesterday.

The company said it aims to reach average occupancy levels for its hospital business of over 70% by the fourth quarter of fiscal 2019.

Fortis shareholders approved IHH’s takeover bid for Fortis, ending months of speculation over control of the company. IHH will invest 40 billion rupees at 170 rupees per share in Fortis. – Reuters