Fortis Healthcare (India) Ltd has acquired 85 per cent stake in Singapore’s RadLink-Asia Pte Ltd for S$62.9 million or $50 million (Rs 251 crore), the company has disclosed in a statement to the Bombay Stock Exchange. Fortis is backed by Singapore’s sovereign wealth fund GIC.
This is the first overseas acquisition by the public-listed firm after it bought and merged Fortis International, the privately held firm controlled by its promoter billionaire brothers Malvinder and Shivinder Singh, in a $665 million deal. Till now, Fortis Healthcare has focused on India business while the promoter-owned Fortis International has managed the overseas business, with a string of acquisitions in the Asia-Pacific region.
In the latest transaction, Fortis Healthcare International Pte, an offshore subsidiary of Fortis Healthcare, acquired majority stake in RadLink-Asia, an outpatient diagnostic and molecular imaging chain in Singapore. Incorporated in 2000, RadLink has four key business segments – diagnostic imaging, molecular imaging, cyclotron (radio-isotopes manufacturing) and GP clinics.
Four years ago, Pacific Healthcare and Kuwait Finance House acquired 30 per cent stake in RadLink-Asia for S$7.26 million, which valued the firm at S$24 million. Fortis has now valued the company at S$74 million or over three times the value it commanded in 2007.
“The transaction provides Fortis Healthcare a strong foothold in the premium diagnostics and molecular imaging segment in one of South-east Asia’s most attractive markets,” the company commented on the acquisition.
Last month, Fortis Healthcare (India) Ltd had completed the $665 million acquisition of Fortis Healthcare International Pte, owned by Malvinder and Shivinder Singh. In this transaction, the purchase consideration for equity shares of Fortis International amounted to $262 million (after taking into account the outstanding liabilities of Fortis Healthcare International), funded through infusion of $262 million against redeemable preference shares to the Singh brothers.
This essentially means that the promoters funded their own public-listed firm to indirectly buy a company owned by them.
Besides the Indian business and RadLink, Fortis Healthcare has a number of overseas healthcare assets including Quality Healthcare Ltd (the largest primary care network in Hong Kong with 580 centres), Dental Corporation Pty Ltd (the largest dental care network in Australia & New Zealand with 177 centres), Fortis Speciality Hospital (an under-construction specialty hospital in Singapore), stake in the 350-bed Lanka Hospitals Corporation (Sri Lanka’s largest super speciality hospital), Hoan My Medical Corporation (one of Vietnam’s largest private healthcare provider groups with over 1,100 beds across six hospitals) and SRL Laboratories, Dubai (the largest private pathology laboratory in the UAE). With the latest deal, Fortis has strengthened its position as one of the largest healthcare firms in Asia as a strong competitor to Singapore-based Parkway Hospitals.
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