Court Orders Forensic Audit in Daiichi-Fortis Case; No Penalty on IHH
Indian court orders forensic audit into Fortis promoter shareholding dissipation and IHH's acquisition; no penalty imposed.
Malaysia's IHH Healthcare has confirmed that an Indian court has ordered the appointment of a forensic auditor in connection with applications filed by Japan's Daiichi Sankyo against Fortis Healthcare. The directive, issued on Tuesday, is aimed at conducting a factual inquiry into the alleged dissipation of shareholding in Fortis by its erstwhile promoters.
The court's order also includes an examination of the transaction through which IHH acquired a controlling stake in Fortis via its unit Northern TK Venture Pte (NTK). Importantly, IHH stated that the court did not impose any penalty or fine on either IHH or Fortis.
This development is part of a long-running legal dispute. IHH had acquired a 31% interest in Fortis through NTK but later paused its open offer for an additional 26% stake after Daiichi Sankyo filed a contempt plea against Fortis's founders. In October 2023, NTK filed a claim alleging that the Japanese drugmaker caused losses by blocking its open offers in 2018. NTK also sought additional compensation in May last year related to a defamation claim.
India's market regulator had cleared IHH's mandatory takeover offer for an additional 26% stake in Fortis and its unit Malar Hospitals in early October last year.
IHH operates 190 healthcare facilities, including 89 hospitals, across 10 countries. Fortis runs 36 healthcare facilities with over 6,000 beds across 12 Indian states.