IHH Healthcare, on Jan 5, announced that it has been in legal tussles with US fund Emqore Envesecure Private Capital Trust since June 2020.
On June 16, 2020, Emqore filed a suit against the Malaysia-headquartered healthcare group. The group was then served on July 26, 2021, with Emqore’s original complaint and its motion to attend.
According to IHH’s statement, Emqore’s claim against IHH arises from allegations relating to the issuance of the shares of Fortis Healthcare to IHH’s subsidiary in and around 2018.
Emqore is alleging that it had “purportedly suffered losses as the defendants had allegedly conspired to frustrate a proposed share acquisition transaction between Fortis and Emqore’s supposed predecessors”.
IHH first acquired a 31% stake in Fortis which triggered a mandatory general offer. While IHH has gained operational control over Fortis, there are outstanding legal issues brought about by other parties such as Japanese drug maker Daiichi Sankyo on Fortis’ previous shareholders.
Under the amended complaint, IHH revealed that Emqore was seeking damages in excess of US$6.5 billion. The sum comprises “compensatory damages plus treble damages and attorneys’ fees pursuant to the US Racketeer, Influenced and Corrupt Organizations Act, against 28 named defendants and 20 non-party defendants.
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The defendants include Malaysian sovereign wealth fund Khanazah Nasional Berhad, as well as India’s Religare Enterprises, Fortis Health Care Holdings and Lakshmi Vilas Bank (LVB), according to Indian publication, The Hindu Business Line.
LVB was amalgamated into DBS India after the Indian central bank made the proposal in November 2020.
At this point in time, IHH says that it is unable to determine the estimated potential liability to IHH arising from the suit, but it does not expect to have any business, operational or financial impact on the group.
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The group adds that it has “strong grounds for dismissal of the suit” and that it would “defend [itself] vigorously against the claims” on three principal grounds, namely for the “lack of personal jurisdiction, forum non conveniens, and failure to state a claim for relief”.
Shares in IHH closed 1 cent lower or 0.45% down at $2.20 on Jan 5.
Photo: The Edge Singapore
