Supreme Court Orders Status Quo On Singh Brothers’ Stake In Fortis Healthcare Till October 31
The order will apply on both encumbered and unencumbered shares held by Singh brothers.
The restriction on brothers Malvinder Singh and Shivinder Singh from diluting their stake in Fortis Healthcare Ltd. will continue till October 31, when the Supreme Court hears a plea by Japanese drugmaker Daiichi Sankyo.
Directing a status quo in the case on Thursday, the top court clarified that its order will apply to encumbered as well as unencumbered shares held by the Singh brothers. The court had on August 11 barred the promoters from reducing their holding in Fortis.
The dispute stems from the U.S. drug regulator’s action against Ranbaxy after Daiichi acquired it from the Singh brothers.
During the previous hearing, Daiichi’s counsel, Senior Advocate Arvind Datar, informed the court that Singh brothers have reduced shareholding in Fortis Healthcare to 37 percent from 52 percent.
The Japanese drugmaker had moved the top court against a June order of the Delhi High Court, which allowed the brothers to issue fresh equity in Fortis Healthcare Ltd. to dilute their stakes in two holding companies – RHC Holdings and Oscar Investments Ltd. The high court, however, directed them to ensure the value of their shares in the two companies doesn’t fall.
Daiichi had approached the court to secure assets of the Fortis Healthcare promoters to realise the Rs 2,560-crore arbitration award it won in Singapore last year over its Ranbaxy deal. The Japanese drugmaker had initiated arbitration alleging the brothers concealed facts about the U.S. drug regulator’s action while selling Ranbaxy.