Fortis Group Internal Re-Organization: Vaish Associates Receives CCI Approval

On 15 September 2016, the Competition Commission of India (CCI) received a notice jointly given by Fortis Healthcare Limited (FHL), Fortis Malar Hospital Limited (FMHL) and SRL Limited (SRL). Hereinafter, FHL, FMHL and SRL are together referred to as the “Parties”. The notice has been filed pursuant to the approval of the Board of Directors of the Parties vide respective board resolutions each dated 19 August 2016.

Vaish Associates Advocates, an Indian law firm that provides high-quality, flexible, client-focused legal and business advisory services, assisted Fortis Group in receiving an approval from the CCI for the internal re-organization of the hospitals and diagnostic business of Fortis Group into separate verticals.

Prior to the proposed combination, the healthcare business of Fortis Group was housed under Fortis Healthcare Limited and FMHL, whereas the diagnostic services were provided by FHL and SRL Limited.

The proposed combination contemplates a series of interconnected steps: (i) FMHL to sell its healthcare business to FHL under slump sale route as a going concern (“Business Transfer”); (ii) FHL to de-merge its diagnostic business undertaking and its investment/shareholding in SRL to FMHL (“De-Merger”) and (iii) SRL to be amalgamated into FMHL, consequent to which the name of FMHL would be changed to “SRL Limited” (“Amalgamation”).

After the combination, the healthcare business of Fortis Group would be undertaken by FHL, whereas the diagnostic services of Fortis Group would be undertaken by SRL Limited.

M. M. Sharma, Head - Competition Law and Policy, assisted by associate Danish Khan, advised Fortis Group for the CCI clearance of the present transaction.