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Singapore : Khazanah Bids S$3.5B To Buy Parkway; Fortis To Exit.

Khazanah Holdings Monday launched a full takeover offer for Parkway Holdings Ltd. (P27.SG), prompting Indian rival Fortis Healthcare Ltd. (532843.BY) to abandon its bid for control of the Singapore healthcare group and sell its stake to the Malaysian sovereign wealth fund.

Khazanah, through its wholly owned Integrated Healthcare unit, has offered S$3.95 a share for the Parkway shares it doesn't already own in a deal that would cost the sovereign wealth fund S$3.5 billion. The full offer follows a partial offer for Parkway made in May in which Khazanah planned to increase its stake to 51%, offering S$3.78 per share. Khazanah currently owns 23.9% of Parkway.

Integrated Healthcare also said in a statement that Fortis has provided an "irrevocable undertaking to Integrated Healthcare to accept the voluntary general offer for all its shares." The voluntary general offer closes Aug. 16.

The move puts an end to speculation that the Indian and Malaysian firms could be locked in a prolonged bidding war, after Fortis launched a S$3.2 billion general offer for Parkway last month. Fortis was offering S$3.80 per share for all of the Singapore company's shares.

Investors cheered Fortis Healthcare's move to sell its entire 24.9% stake in Parkway to Integrated Healthcare, pushing up its shares as much as 6.8%.

"Our decision to exit our investments took into account the interest of all stakeholders of Fortis. It was made after careful assessment in light of other growth opportunities available to us across the region and globally," Chairman of Fortis & Parkway, Malvinder Mohan Singh said.

"We hope to re-invest the value unlocked from this experience to the advantage of our stakeholders, and to support our vision to become a global healthcare provider," he said.

Fortis, which acquired its stake in Parkway from U.S. private equity group TPG Holdings in March for S$960 million, will make a profit of S$116.7 million from the sale of the Parkway stake. It also said it doesn't plan to exit Singapore and will consider a secondary listing on the Singapore Exchange.

At 0833 GMT, Fortis was trading 4.1% higher at INR158.10, while Parkway Holdings placed its shares in a trading halt ahead of the announcement by Integrated Healthcare.

After the acquisition, Khazanah will have control of a network of 16 hospitals with more than 3,400 beds throughout Asia. Khazanah already owns stakes in Apollo Hospitals in India and the Pantai Hospitals and the International Medical University in Malaysia.

"Shareholders who remain invested in Parkway, can continue to participate in Parkway's growth as part of the leading integrated pan-Asian healthcare services provider listed in Singapore," Integrated Healthcare Director Quek Pei Lynn said in the statement.

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Date:Jul 27, 2010
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