New Delhi: India’s Fortis Healthcare said it plans to raise Rs27.5 billion ($585 million) by issuing securities and its board approved increasing its borrowing limit to Rs60 billion, positioning it for a possible battle for Singapore’s Parkway Holdings.
“This means Fortis is keeping the warchest ready if it has to make an open offer,” said Ranjit Kapadia, an equities analyst with HDFC Securities, adding it was not clear whether Fortis will actually make an open offer.
Fortis owns roughly 25% of Parkway and had intended to build up a controlling stake in the company. It was surprised late last month when Malaysian sovereign wealth fund Khazanah offered $835 billion to lift its stake, which was slightly smaller than Fortis’, to a controlling 51.5%.
Fortis, controlled by billionaire brothers Malvinder and Shivinder Singh, has been widely expected to launch a counterbid for control of Parkway.
Malvinder Singh had earlier moved to Singapore to become chairman of Parkway.
Shares in Fortis were up about 1.2% on 9 June, while Parkway shares were up 0.81%. Also on Wednesday, Fortis shareholders approved an earlier plan to issue roughly 22.35 million shares on a preferential basis to a unit of the Government of Singapore Investment Corp (GIC) at 170 rupees each, to raise 3.8 billion rupees.