In a filing with Bursa Malaysia, IHH said it remained committed to proceeding with the open offer for India’s Fortis once the stay is lifted by the court. The next hearing for the matter is on Feb 3, 2020.
Last week, the court held Fortis’ founders – Malvinder Singh and Shivinder Singh – guilty of contempt of court and said it could start similar proceedings against the company, according to a judgment.
This effectively halted IHH’s open offer to Fortis shareholders that would have brought its holdings in India’s second-largest hospital company to above 50%.
IHH is already Fortis’ largest shareholder with a 31% stake.
The corporate exercise involved IHH subscribing for 235.29 million new shares in Fortis; a mandatory open offer to acquire an additional 26% of the expanded capital of Fortis and up to 4.89 million shares or 26% of Fortis Malar Hospitals Ltd.
In yesterday’s statement, IHH said the 31.1% of the expanded voting share capital of Fortis held by IHH through Northern TK Venture Pte Ltd was through a preferential allotment and not through the purchase or transfer of existing Fortis shares.
IHH said the subscription, which was completed on Nov 13, 2018, was undertaken in a fair and transparent manner, after obtaining the requisite corporate and regulatory approvals and in accordance with all applicable laws.
“The board further states that the subscription was undertaken and completed (through a process run by the reconstituted Fortis board) after Malvinder Mohan Singh and Shivinder Mohan Singh (“erstwhile promoters”) were no longer in control of Fortis.
“IHH has at no time dealt with nor colluded with the erstwhile promoters or any entities related or controlled by them in relation to the subscription.
“In light of the judgement, the Fortis open offer as well the Malar open offer (which is subject to the completion of the Fortis open offer) will not proceed for the time being,” it said.