Fortis Healthcare says no risk of bankruptcy

Fortis Healthcare confirmed a report that the company had availed of a three-year loan of Rs 160 cr, but denied that it was done to avoid bankruptcy.

“We wish to confirm that the Company has availed a secured financing facility upto Rs. 160 crore from RattanIndia Finance Private Limited on March 29, 2018.. We would also like to categorially deny the news w.r.t. bankruptcy of the company,” it said.

The statement was a response to a report in the Mint newspaper that said the loan was provided to “help Fortis avert bankruptcy”, quoting unnamed sources ‘close to the development’.

Fortis Healthcare finds itself in the midst of unwanted scrutiny and tighter liquidity conditions after allegations came to the fore that it had moved much of its liquid funds to entities controlled by its promoters, the Singh Brothers.

In its latest statement, Fortis said it would use the proceeds of the loan from RattanIndia Finance “for
meeting its working capital requirements and general corporate purposes.”

RattanIndia Finance is a joint venture between RattanIndia Group and US-based private equity firm Lone Star Funds.

Meanwhile, the company is in the process of restructuring its ownership and bringing in a new promoter after promoters Malvinder Singh and Shivinder Singh stepped down from the director board in February following the allegations of financial impropriety.

Late last month, the company announced that it would merge with rival Manipal Hospitals in a deal involving a value of Rs 15,000 cr.