Exclusive: Leading Fortis shareholder is dissatisfied with offers, expects valuation of Rs 200 per share

作者:Wendy    發表日期:2019-05-15 06:02:26

One of the leading shareholder of Fortis Healthcare on Friday said the price offered by the three interested parties was way below its expectations and

unlikely to be accepted.

「The price they have offered is not reflecting the actual value,」 said a representative of the shareholder, who did not wish to be named.

「The valuation should be closer to Rs 200 …that is a fair value,」 he added.

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The shareholder said none of the three contenders for Fortis have approached them formally.

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The shareholder's statement indicates that a hard bargain is in the offing for Fortis suitors.

Fortis got offer bids from three interested parties that include Manipal-TPG consortium, Sunil Munjal of Hero-Burmans of Dabur and IHH Healthcare.

While the Manipal-TPG consortium made an binding offer valuing the company's share at Rs 155 a piece, the Munjal-Burmans and IHH Healthcare made non-binding offers of Rs 156 per share and Rs 160 per share, respectively.

Munjal-Burmans have offered to invest directly into the company without asking for change of the current structure, operations or delineating the assets under the company.

A binding offer is made by a bidder to acquire a target company after the completion of due diligence.

Ranjan Pai, the Chairman of Manipal Hospitals earlier said in an exclusive interview to Moneycontrol that he isn』t going to be an 「irrational bidder」 and indicated he touched the limits on how far he can go with the value offered to Fortis.

An analyst at a Mumbai-based brokerage house who tracks Fortis said he estimates the fair value of the company to be around Rs 185.

「But there are so many moving parts with this company that may affect the valuation,」 the analyst said.

The above person representing the shareholder said there would be some steps in the coming days from another shareholder East Bridge Capital - where they may insist on getting their directors on board as they now hold around 9.73 percent.

「So there should be some change in the Board constitution while current Board consists of those related to the original promoters,」 the representative added.

Yes Bank became Fortis' largest shareholder with 15 percent stake after it invoked the shares pledged by Malvinder Singh and Shivinder Singh, the erstwhile promoters of Fortis, who now own around 0.77 percent stake in the company.

Blackrock, Morgan Stanley, and ICICI Prudential are the other large institutional investors who have a stake in the company.

Market investors Radhakishan Damani and Rakesh Jhunjhunwala together hold around 1.5 percent stake in Fortis. Damani had picked up 0.5 percent stake in the company in February

Shares of Fortis declined 1.20 percent to close at Rs 151.95 on the BSE, while the benchmark Sensex gained 0.27 percent to end 34,192.65 points.

Fortis is valued around Rs 7,881 crore as on Friday.