Fortis Healthcare Ltd on Sunday said it is confident an independent forensic audit will establish that it had nothing to do with its former promoters' dealings in the Daiichi Sankyo case, and set out a detailed defence of how IHH Healthcare came to control the company in 2018.
"The Company is confident that an independent forensic audit will attest to the above incontrovertible facts," Fortis said in a stock exchange filing. It described itself as a complete stranger to the dispute between Japan's Daiichi Sankyo and former promoters Malvinder and Shivinder Mohan Singh.
The statement comes after the Supreme Court declined to stop the audit. By an order dated September 25, the court disposed of Fortis's special leave petition against the Delhi High Court's August 31 judgment in Daiichi Sankyo Company, Limited vs. Malvinder Mohan Singh & Ors, which had directed a forensic audit relating to the company and made observations against it.
According to Fortis, the apex court let the audit go ahead but clarified that several paragraphs of the high court judgment, including specific ones it identified, are "tentative and only for the purpose of making out a case for forensic audit." The company quoted the court as saying the audit "shall be conducted independently, without being influenced by the abovementioned observations."
Fortis said it was never a party to the arbitration between Daiichi and the Singh brothers and is neither a judgment debtor nor a garnishee in respect of Daiichi's decree. As a listed company it had no power to control how its erstwhile promoters transferred shares they owned, and it received no money from the dissipation of their stake, it said.
The company laid out a timeline to distance its current ownership from the brothers. Their shareholding had fallen below 1% and they had quit the board by March 2018, after which institutional shareholders appointed new independent directors. That board began a competitive bidding process in June 2018 to bring in a new investor. Northern TK Venture Pte Ltd, part of Malaysia's IHH Healthcare Berhad group, invested through a fresh issue of shares in November 2018 after approvals from the Competition Commission of India, Sebi, the exchanges and shareholders, Fortis said, adding that the deal involved no transfer of shares from the Singh brothers.
Fortis reiterated that the Delhi High Court had not imposed any liability, penalty or fine on it.
The litigation stems from Daiichi Sankyo's efforts to enforce a Singapore arbitral award against the Singh brothers, who sold their controlling stake in Ranbaxy Laboratories to the Japanese drugmaker in 2008. Daiichi later alleged the brothers had concealed information about regulatory problems at Ranbaxy.