Fortis and Religare surge on reports of stake sale and restructuring

Fortis Healthcare and Religare Enterprises, promoted by the brother duo of Malvinder Singh and Shivinder Singh, surged in trade post media reports on a possible buyout of a controlling stake in Fortis Healthcare and restructuring of Religare.

According to the reports, global private equity giant KKR & Co. is in talks with the promoter Singh brothers to acquire a controlling stake in its hospital chain arm at an enterprise value of close to Rs 3,000 crore.

As of November 2016, both the brothers held 67.5 per cent stake in Fortis Healthcare. If the deal goes through, KKR will also have to make an open offer for an additional 26 per cent stake in Fortis to meet the takeover norms of market regulator SEBI. As of Thursday, Fortis Healthcare had a market capitalization of close to Rs 9,200 crore.

Recently, the hospital major was also in the news for plans to add more new hospital in the coming year targeting metros as well as small towns.

Fortis Healthcare has been trying to reorganise its structure with plans to list SRL Diagnostic division, which forms part of the healthcare business and contributes around 18 per cent to the overall revenues of the company.

The shares of Fortis and Religare were trading at Rs 195.35, up 5.60 per cent, and at Rs 257, up 3.23 per cent, respectively, on the NSE.