IHH 'evaluating' court's stay on Fortis bid; subscription for 31% stake in target unaffected

File photo showing the logo of Fortis Healthcare, India's second-largest private hospital chain.
File photo showing the logo of Fortis Healthcare, India's second-largest private hospital chain.PHOTO: REUTERS

SINGAPORE - IHH Healthcare confirmed on Monday (Dec 17) that the Indian Supreme Court has put on hold its acquisition of Fortis Healthcare, but said that its subscription for a 31.1 per cent stake in the target is not affected by the ruling.

IHH said that is is currently evaluating the order and seeking appropriate legal advice, and will make appropriate announcements should there be further material developments.

IHH said that the Indian court on Dec 14 passed an order directing that "status quo with regard to sale of the controlling stake in Fortis Healthcare to Malaysian IHH Healthcare Berhad be maintained". The decision was first reported on Dec 15 by Malaysian publication The Star BizWeek.

As a result, IHH's wholly owned subsidiary, Northern TK Venture (NTK), will not be able to proceed with an open offer for Fortis until further orders, clarifications or directions are issued by either or both of the Indian Supreme Court and the Securities and Exchange Board of India.

IHH clarified that the order does not impact the share subscription completed on Nov 13, which gave IHH a 31.1 per cent stake in Fortis through NTK.

IHH shares were trading at $1.830, down one cent or 0.5 per cent as at 1.20pm on Monday.