Will together fund an all-cash bid of $2.3 billion.
Axis Bank, the country’s third largest private sector lender, and the promoters of Fortis Healthcare will together fund an all-cash bid of $2.3 billion (Rs 10,700 crore) by the latter company for Singapore-based Parkway Holdings.
“There are no plans to bring in any outside investors as of now,” said a person familiar with the development.
According to sources, Axis Bank has committed more than $1 billion (Rs 4,660 crore) for the bid. As is customary with transactions of this size, it is likely to sell the loan down to a group of other banks.
Axis had assets abroad of $3.1 billion as of March 31. It raised $350 million in March by issuing five and a half-year bonds under its medium term note programme.
“The exact amount to be funded by banks will depend on the number of shares tendered by investors for sale,” said a senior executive of Axis Bank.
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Macquarie Group and Royal Bank of Scotland are advising Fortis on the transaction. There have been various reports that Fortis is trying to rope in an investor to help fend off Malaysian sovereign fund Khazanah’s counter-offer.
Last week Singapore government’s investment fund, GIC Special Investments Pte Ltd, said it had deferred plans to invest about Rs 380 crore for a minority stake in Fortis. The latter, promoted by the billionaire brothers Malvinder and Shivinder Singh, had said GIC’s decision to defer investment in their company was “mutual”, as GIC wanted to evaluate the prospects of being part of a larger fund-raising plan of Fortis.
Fortis had, on June 9, taken an enabling resolution to raise up to Rs 8,750 crore in debt and equity, if required. Industry analysts had seen this as Fortis’ plans to raise funds for a counter-bid to Khazanah’s offer.