Fortis to sell its Singapore unit for $83.5 million to Fullerton Healthcare Group

Fortis Healthcare has inked a deal to sell its Singapore-based healthcare services unit RadLink-Asia Pte Ltd and its subsidiaries to Fullerton Healthcare Group for approximately $83.5 million (Rs 530 crore).

Reportedly, the deal marks a climb-down in valuation within months as last September, Fortis had announced a deal to sell RadLink to Malaysian firm IHH Healthcare for $108.6 million (Rs 660 crore).

This deal was nixed by Competition Commission of Singapore (CCS), which had raised competition concerns over the proposed acquisition.

RadLink, which was acquired in 2012-13, is engaged in the provision of healthcare services including outpatient diagnostic and molecular imaging services in Singapore.

Having previously sold assets in Hong Kong, Australia and Vietnam, the divestment is part of Fortis' efforts to disengage from its international expansion strategy.

“The significant value that we have created in our international healthcare businesses is now being unlocked and will be ploughed back to strengthen our growth in India,” said Malvinder Singh Executive Chairman, Fortis Healthcare and Shivinder Singh, Executive Vice Chairman, in a joint statement, as mentioned by media reports.
Expectedly, the deal would be closed by coming May 12.

“The divestment of this last major international business is in line with our strategic decision to intensify our focus on our core hospital and diagnostics business in India,” added the duo.

Fortis had flipped its strategy of international expansion within one year of a $665 million deal to buy assets owned by its promoters and now derives almost all revenues from India.

After buying some assets from its promoters in Asia Pacific, it became the first Indian healthcare firm to build a strong overseas business. However, it took a u-turn from its previous strategies of going international, by selling its largest overseas healthcare assets in Vietnam, Australia and Hong Kong.

At present, the firm is focusing on India. It also went asset light by spinning out physical assets into a Singapore-listed entity.

Interestingly, Fullerton Healthcare Group, which is headquartered in Singapore, provides corporate healthcare solutions in the Asia-Pacific region. The company operates in over 130 fully-owned clinics across the Asia-Pacific and is supported by a global network of over 1,000 doctors and nurses, 8,000 medical providers and institutions. The company is backed by Southern Capital.