New Delhi, Mar 28 (PTI) The value of the entity resulting from the merger of Fortis Healthcare and Manipal Hospital Enterprises will be Rs 15,000 crore, a top Fortis official said today.

The merger is expected to be completed in 10-12 months, he added.

“When you look at value of Fortis, when you look at value of Manipal and when you look at money being infused that is Rs 3,900 crore, that adds up to Rs 15,000 crore,” Fortis Healthcare CEO Bhavdeep Singh said in a conference call today.

The value of the resulting entity thus will be 15,000 crore, he added.

The company’s board had yesterday approved the demerger of Fortis hospitals business, which will be acquired by Manipal Hospitals and TPG Capital, along with the sale of 20 per cent stake in diagnostics chain SRL Ltd.

Ranjan Pai and TPG will invest Rs 3,900 crore into Manipal Hospitals. The funds will be utilised for financing the acquisition of 50.9 per cent stake in SRL (20.0 per cent from FHL and 30.9 per cent from other investors for which discussions are currently underway), Fortis Healthcare had said yesterday in a statement.

In addition, the investment will support the proposed acquisition of hospital assets owned by RHT Health Trust and the growth of the hospitals and the diagnostics businesses, it added.

“The merger will take time. The merging of Fortis into Manipal will take between 10 to 12 months,” Singh said.

When asked about the investigations by Serious Fraud Investigation Office (SFIO) in the company over alleged financial irregularities in the company involving its promoters, Singh brothers, Bhavdeep Singh said: “We are cooperating with the ongoing SFIO investigations.” However, the completion of the deal is not contingent upon the conclusion of the ongoing investigations, he added.

The sale of the hospital business of Fortis to Manipal-TPG combine comes at a time when the Singh brothers — Malvinder and Shivinder — are facing intense pressure over alleged financial irregularities at Fortis and Religare, which the SFIO is investigating.

Both Malvinder Singh and Shivinder Singh had quit from the boards of Fortis and Religare last month.

The Delhi High Court had on January 31 upheld an international arbitral award of Rs 3,500 crore passed in favour of Japanese pharma major Daiichi Sankyo, which had alleged that the former promoters of erstwhile Ranbaxy Laboratories had concealed information about proceedings against them by the US Food and Drug Administration.

Moreover, on February 15, the Supreme Court lifted its stay on sale of shares of Fortis Healthcare Ltd. pledged with banks by the Singh brothers before August 31, allowing financial institutions, including Axis Bank and Yes Bank, to sell the pledged shares.

The stake of the Singh brothers in Fortis currently is less than 1 per cent.

The Fortis Healthcare stock fell sharply by 13.37 per cent to Rs 123.40 per on BSE.

This is published unedited from the PTI feed.