Life Care, backed by private equity firm KKR, on Thursday submitted an expression of interest (EoI) for Fortis Healthcare, jumping back in the race to acquire stake in India’s second largest hospital chain.
Manipal-TPG, IHH and Munjal-Burman combine, earlier suitors for the asset who were invited to participate in the fresh bidding process, have also agreed to submit offers for Fortis, said persons directly aware of the development. The Fortis board will now have four bidders to choose from, according to the persons, who spoke to ET on condition of anonymity.
Radiant Life Care managing director Abhay Soi confirmed that the company had submitted an EoI for Fortis. The Fortis board, which was reconstituted following the resignations of three of its older members and the removal of a fourth, began a fresh bidding process for a deal on May 29. The deadline to submit EoIs was May 31, the company told stock exchanges on Tuesday.
As part of the new process, interested parties will receive 10 days to conduct financial and legal due diligence. The board aims to shortlist by June 1 any other bidders based on the EoIs they submit for a transaction. Unconditional binding bids for the company following due diligence have to be submitted between 8:30 am and 9:30 am on June 14.
Fortis will be evaluating binding bids that offer a minimum infusion of Rs 1,500 crore through a preferential allotment and a plan to fund the company’s acquisition of RHT Health Trust assets. The binding offers should also provide an exit to private equity investors in SRL, Fortis’ diagnostic arm, and plans for retention of the current management and employees. The board’s decision to reopen the bidding process followed a letter on Monday from the Munjal-Burman combine which offered their consent for this purpose.
The combine on May 10 had been selected by the earlier board in a 5-3 majority vote and their offer was to be recommended to shareholders for approval. Following their consent, their offer was mutually terminated.
The board, in consultation with its financial and legal advisers, shall evaluate the binding offers using criteria such as the valuation, quantum and schedule of investment. It will also look at the deal certainty, including the simplicity of the transaction structure, timeline, regulatory approvals required and financing arrangement.
Radiant-KKR, like Manipal-TPG, IHH and the Munjal-Burman combine, had submitted a binding offer for Fortis in April. However, unlike the other three, Radiant-KKR did not revise its offer for the company. Following the previous board’s decision to recommend the Munjal-Burman offer on May 10, Manipal-TPG and IHH had submitted revised offers for the company.
Source: Economic Times