Radiant revises its bid , makes a binding offer to purchase Fortis Mulund hospital

Wants hospital business of Fortis to be spun into a new company for Radiant to make open offer for the new outfit.

The battle for control of Fortis Healthcare has further intensified with Radiant Life Care Private Ltd. presenting re-worked revised offer.

The revised offer has a twin component - a binding one and and a non-binding.

The binding portion of the offer provides for an outright buying of Fortis Mulund hospital. The non-binding offer provides for hiving off the hospital business of Fortis into a new company and Radiant making a open offer for the new company at a specific price.

The two-part revised proposal has added fresh twist to the Fortis game, coming as it does closely after IHH of Malaysia revising its offer and converting its original offer into a partly binding one.

Radiant has made a binding offer to purchase Fortis Mulund hospital without due diligence and as a going concern, at an enterprise value of ₹1,200 crore as a first step.

This deal, according to Radiant, will provide Fortis an immediate liquidity of ₹680 crore. This would include the proceeds from the of sale of 30.04% stake of Fortis in RHT (Religare Healthcare Trust). ``We believe that RHT would divest Fortis Mulund assets at the appraisal value of ₹683 crore as mentioned in the RHT 2017 annul report,'' Radiant said. The offer would provide Fortis immediate and guaranteed liquidity without any equity dilution for the shareholders of Fortis, Radiant said.

The revised proposal also comprises a non-binding offer, which is independent of the binding offer for Mulund hospital. Radiant has also mooted the idea of spinning-off or excluding SRL from the exercise so as to allow Fortis run an independent competitive sale process to maximize returns for the shareholders.

Radiant has proposed de-merger of the hospital business form Fortis into a new company (excluding the stake of Fortis in SRL). Radiant said it would then launch an all-case open offer to shareholders of the new company at a price of ₹126 per share of the new company. The offer is conditional upon Radiant able to acquire 26% in the new company. If it couldn't, the new company should make a preferential allotment to Radiant at ₹126 per share to enable it hold 26% in the new company. In order to fund RHT stake acquisition, Radiant proposed a right issue offer by the new company. “The entire rights offer amount would be back-stopped by Radiant,'' it said in its revised offer. “This leg of the offer is non-binding and subject to due diligence,'' it said.