Fortis healthcare raises $100m from IFC
Indian hospital and diagnostics group Fortis Healthcare is to issue 28.6 million shares to the International Finance Corporation (IFC) for a total of $45 million. Another $55 million will come through a private placement of foreign currency convertible bonds (FCCB), which will have a floor price of INR99.09 ($1.8).
In a filing, the company said the board of directors has also decided to issue between 34.9 million to 45 million fresh shares through an Institutional Placement Programme (IPP) at a face value of INR10 each. The IPP will bring down the promoter's holding to 75% from 81%, to adhere to the Securities and Exchange Board of India's (SEBI) listing norms.
The IFC has previously invested $24.5 million in Fortis' diagnostics chain subsidiary, Super Religare Laboratories (SRL). Last year, Jacob Ballas Capital India committed INR2.5 billion ($44.7 million) to the diagnostic unit, and Sabre Partners and Avigo Capital Partners invested a total of INR1.5 billion in 2011.
Fortis Healthcare has taken a number of measures recently to cut its debt burden, which was INR46 billion ($851 million) as on 30 November, 2012. Last October, the company raised approximately INR22 billion by listing its Religare Health Trust unit on the Singapore Stock Exchange. It is also in the process of selling its Dental Corporation Holdings to BUPA for AUD270 million.
Fortis healthcare operates in India, Hong Kong, Singapore, Vietnam, Dubai, Mauritius, Sri Lanka, Nepal, Australia, New Zealand and Canada with 76 healthcare facilities, over 600 primary care centres, 194 day care speciality centres, over 240 diagnostic centres and around 23,000 staff.
According to a report from consultancy firm RNCOS, the Indian diagnostic market is set for compound annual growth of 26% between 2012 and 2015, on the back of increasing investment, expansion into smaller cities and government support. Meanwhile, the industry is shifting from small, unorganized laboratories into sizeable institutions that provide reliable quality services with a larger range of diagnostic tests.
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