Gold Silver Reports (GSR) – Fortis Healthcare Falls After Board Backs Munjal-Burman Offer – Shares of the country’s second largest hospital chain operator fell as much as 3.2 percent to Rs 148 after its board said it will recommend the offer proposed by the Munjal and the Burman family offices for the healthcare chain’s hospital and diagnostics businesses.
Sunil Munjal’s Hero Enterprise Investment Office and the Burman Family Office, which jointly own a minority stake in Fortis, has committed to invest Rs 1,800 crore in the Indian healthcare chain.
📌 Of this, Rs 800 crore will be infused through a preferential issue at Rs 167 a share
📌 The rest will be invested through warrants at Rs 176 a share, with Rs 250 crore of that coming up front.
📌 Including the warrant subscription amount, their upfront investment would be Rs 1,050 crore without any due diligence.
📌 Speaking to BloombergQuint, Amit Tandon of proxy advisory firm IiAS said, all the offers are close and financially this is not the best offer.
Key conversation highlights:
📌 Look forward for more clarity on basis of selecting this offer from Fortis board before taking a final view
📌 Don’t think decision will see any change as of now
📌 Board must come out with the rationale of choosing this offer
📌 Was definitely not the most obvious offer at first
📌 Offer approval on majority and not consensus
Bharti Airtel, Idea Cellular Slump After Jio Launches Postpaid Plan
Shares of Bharti Airtel and Idea Cellular fell as much as 6 percent and 8.4 percent each respectively after Reliance Jio launched post-paid plan with monthly rental of Rs 199, and an ISD calling service at a starting price of 50 paise per minute.
The company also announced international roaming service with outgoing calls at Rs 2 per minute onwards.
The new plan launched by Jio will lead to further decline in average revenue per user (ARPU) for incumbent players, international brokerage firm Jefferies said in a note.
“This is at 50 percent discount to comparable packs by incumbents and 60 percent discount to postpaid ARPUs. We have been concerned on postpaid as it contributes 20 percent plus of revenues. With the sharp discount launch by Jio we expect incumbents to also respond and thus expect further decline in ARPU for Bharti and Idea,” Jefferies analysts Piyush Nahar, Somshankar Sinha and Pratik Chaudhuri wrote in a note. – Neal Bhai Reports (NBR)
