MUMBAI • Malaysia's IHH Healthcare said yesterday that India's Fortis Healthcare declined to engage with the company regarding a takeover offer, citing binding agreements with other parties.
IHH, one of Asia's largest healthcare operators, offered to buy Fortis last week at a price that values the hospital chain at about US$1.3 billion (S$1.7 billion) - higher than the roughly US$1.2 billion valuation an offer from Indian rival Manipal Health Enterprises gave it.
Some of Fortis' minority shareholders are dissatisfied with the Manipal Health offer, and it is unclear if the IHH price appeals to them. Shares of Fortis fell about 2 per cent yesterday after the announcement while IHH shares ended unchanged at $2.05.
A merger with a hospital chain such as Manipal Health might make more sense, said an analyst with a brokerage in Mumbai, adding that more details of the IHH offer were needed.
Fortis, which is under investigation over financial fraud, has seen interest from multiple parties since Manipal Health offered to buy it last month. Two Indian investors - Mr Sunil Munjal's Hero Enterprise and the Burman Family Office - offered last week to make an investment worth 12.5 billion rupees (S$250 million).
IHH said yesterday that Fortis indicated it was unable to engage due to binding agreements with Manipal Health Enterprises, Manipal Global Health Services and private equity firm TPG Asia.
The Singapore-listed Malay-sian company had said last week in its proposal letter that it expected a response from Fortis before tomorrow.