Lenders Now Free To Sell Singhs’ Pledged Fortis Healthcare Shares
Supreme Court lifts status quo on Fortis Healthcare assets pledged before August 11 last year.
The Supreme Court ordered that financial institutions holding pledged shares of Fortis Healthcare Ltd. are free to sell them even as Japan’s Daiichi Sankyo is looking to prevent the Singh brothers from selling assets to enforce its Rs 3,500-crore arbitral award.
The apex court today clarified that the status quo it had imposed on Fortis assets “shall not apply to shares of Fortis Healthcare Limited held by Fortis Healthcare Holding Pvt. Ltd.” that may have been encumbered on or before its August 11 and 31 orders last year. Which means, such shares pledged before August 11 are now free to be sold if the lenders so desire.
The order comes at a time when Malvinder and Shivinder Singh are trying to finalise the sale of their stake in Fortis Healthcare, India’s second-largest hospital chain, Bloomberg reported. It’s not clear if the lenders are keen to sell the shares and if they will sell to buyers lined up by the Singh brothers. The brothers have also been accused of “diversion, siphoning and digression of assets” by a New York-based investor in a lawsuit, Bloomberg reported.
Also Read: Singh Brothers Resign As Fortis Directors
Japanese drugmaker Daiichi Sankyo has been looking to prevent the sale of assets till it is paid Rs 3,500 crore it won in the Singapore tribunal against the Singh brothers for concealing information while selling erstwhile Ranbaxy Laboratories Ltd. The Delhi High Court last month ruled that the award is enforceable in India. The Singh brothers challenged the order in the Supreme Court.
Fortis Healthcare Holding owned 38.65 percent in Fortis Healthcare and 36.58 percent was pledged to financial institutions as of August 4 last year. Key lenders Yes Bank Ltd., Axis Bank Ltd., RBL Bank Ltd and ECL Finance Ltd. are all parties in the case.
The holding company’s stake in the hospital chain stood at 34.33 percent as on Jan. 31, according to exchange filings.