After the consortium of Manipal Health Enterprises (MHEPL) and private equity (PE) firm TPG Asia revised their offer to acquire a stake in Fortis Healthcare, Amit Tandon, Managing Director, IiAS, spoke to CNBC-TV18, said there is a interesting trade off which the investors and more importantly the board needs to make at this stage.
"One is for a binding bid which comes in at a lower price versus non-binding bid at a higher price,” he said.
The TPG Asia is proposing to infuse Rs 2,100 crore into Fortis Healthcare at a share price of Rs 160 per share.
He said, "There are also other issues in terms of whether the money is going to come upfront or little bit later, how much is going to come up front, what are the entities going to do with Singapore assets, how are they treating the diagnostic businesses etc. Therefore, there are lot moving part to this deal which the board will evaluate given the fact that all bids have come in.
When asked what would be the ideal steps from the corporate governance point of you for Fortis minority shareholders in getting this deal done, he said the board has to make some difficult choices in terms of would it like an Indian promoter, would it like foreign hospital chain, would it like to be owned by someone with hospitals etc.
"One of the things we have suggested is that they need to go back to all the bidders and give diligence document out to them and get them to bid on basis of that, so that bids are comparable. Having said that it would be better if investors are not given a choice to vote for A or B, which become complicated," said Tandon.
"In the interest of simplicity, we would expect the board to take one decision and put it to the shareholders to vote,” said Tandon, adding that, they would prefered if a straightforward bidding process was used and was given to the highest bidder but since they have chosen this process, one would have to wait and see what is finally proposed to the shareholders.