NEW DELHI — The Singh family, founders of Fortis Healthcare Ltd. and Religare Enterprises Ltd., will focus on growing their healthcare business, and have put in place a key management team to handle the financial services business.
The changes in the management of Religare Enterprises comes within a month of Fortis Healthcare’s purchase of a 24% stake in Singapore healthcare provider Parkway Holdings Ltd. The move was largely seen as a stepping stone for the Singh family, whose ambition is to build a global healthcare business.
“We, as a group, have a clear vision for both our businesses, healthcare and financial services. To make sure they aspire to be at the forefront of their respective areas and also to look at the businesses in a global perspective,” Fortis Healthcare Chairman Malvinder Mohan Singh told reporters at a news conference Tuesday.
Religare Enterprises said Mr. Malvinder has stepped down as chairman of the company’s board while Sunil Godhwani was named as the new chairman and retains his title as managing director. Shivinder Mohan Singh, Malvinder’s brother, resigned as a board member, it said also.
Mr. Malvinder said he, along with Mr. Shivinder, together hold about 57%-60% in Religare Enterprises.
While Mr. Malvinder will focus on global healthcare opportunities and associate more closely with Parkway in his capacity as the Singapore-based company’s chairman, Mr. Shivinder will concentrate on the Indian operations of Fortis Healthcare.
Religare Enterprises has reached “a stage where we (the founders) are very comfortable to have a professional board and a professional management in place,” said Mr. Malvinder.
The healthcare business, on the other hand, requires the family’s entrepreneurial skills to tap local and international opportunities with an aim “to create a global healthcare delivery network,” he added.
At the time of the Parkway acquisition, Mr. Malvinder had said he, along with another member from the management team of Fortis Healthcare, will relocate to Singapore to work with Parkway’s current management.
The Parkway deal was the biggest overseas buy in valuation by an Indian company in the healthcare services space and comes at a time when demand for such services has started to rise in Asia, as the region rapidly becomes known as a medical tourism destination and its middle class begins to spend more for healthcare.
Fortis Healthcare’s $685.3-million purchase of TPG Inc.’s stake in Parkway Holdings is also the biggest ever acquisition for the Indian company by valuation, propelling it to become one of Asia’s largest hospital network operators with 62 hospitals and more than 10,000 beds.
Fortis Healthcare, set up in 1996, has been spreading its reach with smaller acquisitions over the last few years. Just last year, it announced a deal to buy 10 hospitals from privately-owned Wockhardt Hospitals Ltd. for 9.09 billion rupees. In early 2009, it, along with a partner in Mauritius, acquired the island’s largest private hospital, Clinique Darne.
Among its several India acquisitions was the buyout of five hospitals of Escorts Hospitals in 2005.
Tuesday, Mr. Malvinder said that Fortis Healthcare is open to acquisitions in Asia, including India, to strengthen its presence in the region. He added that the company will subsequently look at acquisitions beyond Asia.
In 2008, the Singh family sold its 34.8% stake in Ranbaxy Laboratories to Japan’s Daiichi Sankyo Co. for about $2 billion, helping it spruce up its kitty to expand Religare Enterprises and Fortis Healthcare.
About Religare Enterprises Limited Religare is a global financial services group with a presence across Asia, Africa, Middle East, Europe and the Americas. In India, Religare’s largest market, the group offers a wide array of products and services ranging from insurance, asset management, broking and lending solutions to investment banking and wealth management. The group has also pioneered the concept of investments in alternative asset classes such as arts and films. With 10,000 plus employees across multiple geographies, Religare serves over a million clients, including corporates and institutions, high net worth families and individuals, and retail investors.