Jordan Ellis
Fortis Healthcare Limited is an Indian for-profit private hospital network. It was founded in 1996 by Malvinder Mohan Singh and Shivinder Mohan Singh, who are brothers and erstwhile billionaires. The Singh brothers lost ownership of Fortis in 2018 after a series of fraud allegations and legal battles. In 2018, IHH Healthcare, a Malaysian healthcare company, acquired a 31% stake in Fortis for around Rs 4,000 crore, and Dr Ashutosh Raghuvanshi was brought in by IHH to steer Fortis.
| Characteristics | Values |
|---|---|
| Current Owner | IHH Healthcare |
| Previous Owners | Singh Brothers (Malvinder Mohan Singh and Shivinder Mohan Singh) |
| Year of Acquisition | 2018 |
| Acquisition Details | 31.1% controlling stake for ₹4,000 crore |
| Acquisition Issues | Delayed by the Supreme Court due to Daiichi Sankyo's contempt plea against the Singh brothers |
| Current Number of Hospitals | 27 |
| Current Number of Operational Beds | 4,500+ |
| Current Revenue | ₹6,298 crore |
| Current Profit | ₹633 crore |
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What You'll Learn
- Fortis Healthcare was founded by Malvinder Singh and Shivinder Singh in 1996
- The Singh brothers lost ownership of Fortis in 2018 due to allegations of fraud
- IHH Healthcare acquired a 31% stake in Fortis in 2018, taking control of the company
- Dr Ashutosh Raghuvanshi was brought in by IHH to lead Fortis Healthcare
- Daiichi Sankyo, the owner of Ranbaxy Laboratories, sued the Singh brothers for fraud
Fortis Healthcare was founded by Malvinder Singh and Shivinder Singh in 1996
Fortis Healthcare is an Indian for-profit private hospital network headquartered in Gurgaon, India. It was founded in 1996 by brothers Malvinder Singh and Shivinder Singh as an offshoot of the pharmaceutical company Ranbaxy Laboratories. The company's first hospital was established in Mohali, Punjab, and it has since expanded to operate hospitals in Delhi NCR, including locations in Faridabad, Noida, Vasant Kunj, and Shalimar Bagh, with other facilities across India, Dubai, and Sri Lanka.
Malvinder and Shivinder Singh are the grandsons of Bhai Mohan Singh, the founder of Ranbaxy Laboratories, which later merged with Sun Pharmaceuticals Ltd. After their father's death in 1999, the brothers inherited a 33.5% stake in Ranbaxy. They set up Fortis Hospitals, which quickly became a success, acquiring other healthcare businesses and expanding across India. By 2011, Fortis Hospitals had 52 hospitals across the country.
However, in 2018, the Singh brothers lost control of Fortis Healthcare due to allegations of fraud and fund diversion. They were accused of siphoning off money from Fortis and using funds from Religare, an NBFC they had floated, to settle personal liabilities. Auditors refused to give the company a clean chit, and the Singh brothers eventually resigned from their positions at Fortis. The company was then acquired by IHH Healthcare, a Malaysian healthcare company, which now controls a 31.1% stake in Fortis. Despite a shaky start with IHH taking over, Fortis Healthcare has been showing signs of recovery, with revenues and profitability up and debt down.
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The Singh brothers lost ownership of Fortis in 2018 due to allegations of fraud
Fortis Healthcare Limited is an Indian for-profit private hospital network headquartered in Gurgaon, India. The hospital was founded in 1996 as an offshoot of the pharmaceutical company Ranbaxy Laboratories. Fortis Healthcare was founded by Malvinder Singh and Shivinder Singh, grandsons of Bhai Mohan Singh, the founder of Ranbaxy Laboratories.
In 2008, the Singh brothers sold Ranbaxy to Japan's Daiichi Sankyo for $4.6 billion. However, in 2010, the US Food and Drug Administration banned imports from two of Ranbaxy's Indian plants. The US Department of Justice launched a probe, and Ranbaxy eventually pleaded guilty to selling adulterated drugs and paid a $500 million settlement.
In 2018, the Singh brothers faced allegations of fraud and money laundering. They were accused of siphoning off funds from the sale of Ranbaxy and from Fortis Healthcare. The Serious Fraud Investigation Office (SFIO) and the Securities and Exchange Board of India (SEBI) launched investigations into the allegations. The Singh brothers also faced legal action from Daiichi Sankyo, which accused them of withholding information during the sale of Ranbaxy. The Delhi High Court ordered the brothers to pay ₹3,500 crore ($550 million) in damages to Daiichi Sankyo.
As a result of these allegations and investigations, the Singh brothers lost ownership and control of Fortis Healthcare in 2018. They were unable to repay loans, which resulted in the invocation of their shares by banks and financial institutions. In November 2018, IHH Healthcare, a Malaysian company, acquired a 31.1% controlling stake in Fortis for ₹4,000 crore. Representatives from IHH Healthcare were appointed to the board of Fortis, and the company embarked on a journey to improve its financial performance and reputation.
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IHH Healthcare acquired a 31% stake in Fortis in 2018, taking control of the company
Fortis Healthcare Limited is an Indian for-profit private hospital network headquartered in Gurgaon. It was founded in 1996 as an offshoot of the pharmaceutical company Ranbaxy Laboratories. Fortis Healthcare was founded by Malvinder Singh and Shivinder Singh, who served as the non-executive vice chairman. Fortis Healthcare began its operations in Mohali, Punjab, where its first hospital was established.
In 2018, the Singh brothers lost control of the management of Fortis Healthcare due to allegations of fraud and siphoning off funds. This led to a bidding war for the company, with Manipal Hospitals and TPG Capital offering to buy out the Singh brothers' stake in the company.
Eventually, IHH Healthcare, a Malaysian healthcare company, emerged as the winner by acquiring a 31.1% controlling stake in Fortis Healthcare for ₹4,000 crore (approximately $550 million). IHH Healthcare's acquisition of Fortis gave them control of the company, and they appointed their representatives to the board of Fortis.
The acquisition by IHH Healthcare was not without challenges. Daiichi Sankyo, the owner of Ranbaxy Laboratories, sought to recover costs from the Singh brothers and accused them of diverting funds. This led to legal battles and a forensic investigation, with the Supreme Court ordering a status quo and halting the IHH-Fortis open offer temporarily.
Despite these initial hurdles, IHH Healthcare's acquisition of Fortis Healthcare has shown signs of recovery. Under the leadership of Dr Ashutosh Raghuvanshi, revenues and profitability have increased, and debt has decreased. Fortis Healthcare has been able to solidify its position in the Indian healthcare industry and expand its network of hospitals.
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Dr Ashutosh Raghuvanshi was brought in by IHH to lead Fortis Healthcare
Fortis Healthcare is an Indian for-profit private hospital network headquartered in Gurgaon. It was founded in 1996 as an offshoot of the pharmaceutical company Ranbaxy Laboratories. In 2018, Fortis Healthcare was acquired by IHH Healthcare, a Malaysian healthcare company. Post-acquisition, Dr Ashutosh Raghuvanshi was brought in by IHH to lead Fortis Healthcare.
Dr Ashutosh Raghuvanshi is a cardiac surgeon turned management leader. Before joining Fortis, he was working with Narayana Health as Vice Chairman, Managing Director, and Group CEO. He has over 26 years of experience in the healthcare industry and has been associated with various prestigious institutions such as the Bombay Hospital, Apollo Hospitals, and Manipal Heart Foundation. He is also credited with establishing the Rabindranath Tagore International Institute of Cardiac Sciences in Kolkata, which is now one of the largest multispecialty hospitals in Eastern India.
After taking over Fortis Healthcare, Dr Raghuvanshi faced significant challenges due to the negative reputation and financial instability of the hospital. He recalled that the environment within the organisation was characterised by fear and distrust, with people questioning the past mistakes and concerned about their job security. However, he took a thoughtful approach by investing time in understanding the people and issues, while also implementing the necessary changes to steer the company in a positive direction.
Under the leadership of Dr Raghuvanshi, Fortis Healthcare has shown remarkable improvement. The company's revenues and profitability have increased, while its debt has decreased. As of 2024, Fortis Healthcare operates 27 hospitals with over 4,500 operational beds. The successful turnaround of Fortis Healthcare under Dr Raghuvanshi's guidance demonstrates his effective management skills and ability to lead the company towards growth and recovery.
Fortis Healthcare's previous owners, the Singh brothers (Malvinder Mohan Singh and Shivinder Mohan Singh), faced legal troubles and were arrested for criminal breach of trust, with numerous cases of fraud registered against them. The Delhi High Court ordered them to pay $550 million in damages to Daiichi Sankyo for misrepresenting information during the sale of Ranbaxy Laboratories. IHH Healthcare's acquisition of Fortis brought about a positive change in leadership, with Dr Raghuvanshi playing a pivotal role in the company's transformation.
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Daiichi Sankyo, the owner of Ranbaxy Laboratories, sued the Singh brothers for fraud
Fortis Healthcare Limited is an Indian for-profit private hospital network headquartered in Gurgaon. It was founded in 1996 as an offshoot of the pharmaceutical company Ranbaxy Laboratories. Fortis Healthcare was founded by Malvinder Singh and Shivinder Singh, who are brothers and erstwhile billionaires. In 2018, the Singh brothers resigned from Fortis Healthcare amid a legal battle with Daiichi Sankyo.
Daiichi Sankyo is a Japanese multinational pharmaceutical company. In June 2008, Daiichi Sankyo acquired a 34.8% stake in Ranbaxy at a valuation of $2.4 billion. By November of the same year, Daiichi Sankyo had completed the takeover of Ranbaxy from the founding Singh family, ending up with a 64% stake in the company.
In 2009, Daiichi Sankyo discovered that the Singh brothers had made false representations to them. The Singh brothers concealed a document known as the Self-Assessment Report (SAR) and also concealed the genesis, nature, and severity of pending investigations by the US Food and Drug Administration (FDA) and Department of Justice (DOJ) against Ranbaxy. This led to Daiichi Sankyo suing the Singh brothers for fraud.
In May 2016, the Singapore International Arbitration Centre ordered the Singh brothers to pay $500 million for concealing information when they sold Ranbaxy's shares to Daiichi Sankyo in 2008. The brothers challenged this ruling. In January 2018, Daiichi Sankyo moved the Delhi High Court to enforce the arbitration award, which was upheld. The Singh brothers were asked to pay Rs. 3500 crore to Daiichi Sankyo in damages on grounds of fraudulent misrepresentation and concealment of material facts.
The Singh brothers have faced numerous other legal troubles, including accusations of siphoning off money and misappropriation. They have also been arrested for criminal breach of trust.
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Frequently asked questions
IHH Healthcare, a Malaysian healthcare company, currently owns a 31.1% controlling stake in Fortis Healthcare.
Fortis Healthcare was founded by brothers Malvinder Mohan Singh and Shivinder Mohan Singh in 1996. They lost ownership of the company in 2018 due to various legal issues and allegations of fraud.
Fortis Healthcare Limited is an Indian for-profit private hospital network headquartered in Gurgaon. It currently operates 27 hospitals and has 4,500+ operational beds.
The Singh brothers were arrested for criminal breach of trust and have several cases of fraud registered against them. They were also ordered to pay millions in damages to Daiichi Sankyo for misrepresenting information during the sale of Ranbaxy Laboratories but failed to do so.
Dr. Ashutosh Raghuvanshi, brought in by IHH from Narayana Health, currently leads Fortis Healthcare.
