Thursday , January 24 2019

Sebi examines Fortis after ‘$78mn money taken out’


India’s capital market regulator is examining Fortis Healthcare Ltd. and will look into Religare Enterprises Ltd., following reports alleging money was taken from the companies by Malvinder and Shivinder Singh, who are part of the founding family of both companies.
“We are examining the Fortis issue,” Securities & Exchange Board of India Chairman Ajay Tyagi told reporters in New Delhi. “We also received a reference on Religare from somewhere I cannot disclose, and it will be looked into.”
The Singh brothers took at least 5 billion rupees ($78 million) out of the publicly-traded hospital company they control without board approval about a year ago, Bloomberg reported Feb. 9, according to people with knowledge of the matter. The funds were reported on the balance sheet of Fortis as cash and cash equivalents, but the money was routed and placed under the control of the Singhs at the time, according to the people.
Separately, a New York-based investor has accused the brothers of “diversion, siphoning and digression of assets” in a lawsuit filed in the High Court of Delhi. The plaintiff is a fund managed by the $12.6 billion private equity firm Siguler Guff & Co. with a 6 percent stake in the Singhs’ small-business lending unit, Religare Finvest Ltd., which is a subsidiary of Religare Enterprises. Bloomberg reported on the suit on Jan. 29.

Related-Party Transactions
Religare hasn’t been approached by the regulator and will cooperate with government authorities, it said Monday in an emailed response to questions. Representative for Fortis didn’t immediately reply to an email seeking comment on the step by the regulator.
Shares of Fortis fell as much as 3.4 percent on Monday in Mumbai, while the benchmark S&P BSE Sensex rose as much as 0.8 percent.
Religare has denied the allegations, while Fortis said the company loaned 4.73 billion rupees in the normal course of treasury operations and the loans have since been recognized as related-party transactions.

About Admin

Check Also

China rips into Tencent’s news service, kills apps

Bloomberg China is stepping up its efforts to rein in the country’s internet, singling out ...

Leave a Reply

Your email address will not be published. Required fields are marked *