KUALA LUMPUR (Dec 17): IHH Healthcare Bhd remains committed to its India investment in Fortis Healthcare Ltd despite new hurdles to acquire an additional stake in the latter, IHH managing director and chief executive officer Dr Tan See Leng told the group's staff today.

In an internal memo sighted by theedgemarkets, Tan said although the India Supreme Court has ordered the group’s acquisition of Fortis to remain status quo, the development does not in any way diminish management’s resolve and commitment to grow the Indian healthcare group.

“We will continue to execute on our plans to stabilise Fortis and ensure that it achieves its full potential as part of the IHH family. You are the heart and soul of Fortis. We are confident that with your continued support and efforts, we can move forward together to make Fortis India’s leading healthcare provider,” he said.

Tan’s reassurance to staff came after the Supreme Court of India issued a directive last week that the ‘status quo’ be maintained in the sale of the controlling stake in Fortis Healthcare to IHH.

The ruling came after a contempt petition filed by Daiichi Sankyo Co in its dispute against the former promoters of Fortis Healthcare Malvinder Singh and his brother Shivinder Singh.

Daiichi Sankyo, a Japanese drugmaker, is seeking an arbitration award amounting to US$385 million from the Singh brothers, following a dispute with them arising from Daiichi Sankyo's acquisition of pharmaceutical company Ranbaxy Laboratories.

Daiichi Sankyo sought the court order to stop IHH from acquiring Fortis Healthcare because the Singh brothers had pledged their shares in Fortis Healthcare to satisfy the award.

With the court order, IHH announced that it has paused its mandatory open offer to acquire another 26% shareholdings in Fortis Healthcare.

In a filing with Bursa Malaysia, today, IHH said in light of the Court’s order, its wholly-owned subsidiary Northern TK Venture Pte Ltd (NTK) and persons acting in concert will not be able to proceed with the open offer for the time being until further order, clarification, or directions are issued by India’s Supreme Court or Securities and Exchange Board of India.

IHH said it is in the process of evaluating the court order and seeking appropriate legal advice on this matter before deciding future course of action.

Tan, in the memo, also said the Court’s order does not impact IHH’s subscription of 31.1% stake in Fortis Healthcare, which was completed in accordance with applicable laws on Nov 13 this year.

“IHH remains the largest shareholder in Fortis, having a controlling stake of 31% by way of equity shares allotted through preferential allotment. IHH had already made an infusion of INR 4,000 crore in Fortis last month to meet Fortis’ immediate capital requirements and will ensure that it continues to operate smoothly,” he said.

At the time of writing, IHH shares had slipped 3 sen to RM5.37, giving it a market capitalisation of RM47.27 billion.