Fortis: SEBI Probes Insider Trading Violation, Other Regulatory Lapses
Market regulator SEBI is probing suspected insider trading by some institutional investors and other regulatory lapses at Fortis Healthcare Ltd. amid a takeover battle and boardroom upheaval at the hospital chain, officials said.
Apart from the SEBI probe that also includes investigation into suspected disclosure lapses, the Serious Fraud Investigation Office and registrar of companies are looking into alleged financial irregularities at Fortis and other promoter group entities including Religare, they added.
There were five suitors in the race for Fortis, including TPG-Manipal combine, Malaysia's IHH Healthcare and KKR-backed Radiant Life Care, which gave binding offers. However, China's Fosun Healthcare did not make a binding bid for the company.
Besides, three directors have already resigned ahead of a shareholder vote on Tuesday to decide their future.
The Securities and Exchange Board of India had first begun the investigation in February following reports that financial irregularities emerged at Fortis. The company was asked to furnish information and documents sought by the regulator.
The development came against the backdrop of reports that Fortis’ promoters -Malvinder Singh and Shivinder Singh - took at least $78 million (Rs 550 crore) out of the company without any board approval about a year ago.