KUALA LUMPUR (Nov 10): IHH Healthcare Bhd (KL:IHH) has received a tepid response to its mandatory takeover offers for an additional  26% stake each in India-based healthcare group Fortis Healthcare Ltd and its subsidiary Malar Hospitals Ltd, which closed on Nov 4.

According to its bourse filing on Monday, only 1,778 shares — equivalent to a 0.0002% stake — in Fortis were tendered, while only 4,523 shares in Malar, or 0.02%, were accepted. Following the close of the open offers, IHH’s holdings stand at 31.17% in Fortis and 62.73% in Malar.

The muted acceptance reflects the strong share price performance of both companies over the past seven years, as they turned profitable post-pandemic. Fortis has surged more than five-fold to 980.4 rupees per share as of Friday, while Malar has tripled to 65.2 rupees.

The open offer for the additional Fortis stake was first announced in July 2018, when IHH stepped in as a white knight with a RM2.4 billion subscription for a 31.1% stake. Fortis, in turn, holds 62.4% of Malar, which operates healthcare facilities in the southern Indian city of Chennai.

At the time, IHH had committed to a minimum offer price of 170 rupees per Fortis share, or a total of 3,349 crore rupees (RM1.59 billion). The Malar offer was last revised in August 2024, following dividend adjustments, to 17.6 rupees (RM8.05) per share, valuing the 26% stake at 8.6 crore rupees (RM4.08 million).

For the financial year ended March 31, 2025, Fortis reported a profit after tax of 809 crore rupees, on revenue of 1,655 crore rupees. It operates 33 healthcare facilities with over 5,700 beds and 400 diagnostic labs.

IHH has been present in India since 2002, with six hospitals and three medical centres totalling 1,600 beds, making the country its fourth home market. Its entry into Fortis followed the exit of founders Malvinder Singh and Shivinder Singh, who relinquished their stakes amid debt issues and allegations of fund siphoning.

The acquisition saw IHH outbid rivals, including Manipal Hospital Enterprises with TPG Capital, Hero Enterprises with the Burman family of Dabur, Fosun Health Holdings of China, and Radiant Lifecare backed by KKR.

The mandatory open offer deal had earlier been stalled in court due to disputes between Fortis’ promoters and Daiichi Sankyo Co Ltd, linked to the Japanese group’s acquisition of Ranbaxy Laboratories from the Singh brothers.

In May this year, IHH, through its subsidiary, escalated its damages claim against Daiichi Sankyo tenfold to over ¥200 billion (RM5.71 billion), alleging obstruction of its open offer for Fortis and Malar shares.