In a major blow to Singh brothers – the promoters of Fortis Healthcare and Religare Enterprises – the Delhi high court in its interim order on Monday attached all assets of RHC Holdings and Oscar Investments.
RHC Holdings and Oscar investments are privately-held holding companies that own assets of Malvinder Singh and Shivinder Singh referred as Singh brothers.
The case is related to the enforcement of a foreign arbitration award of Rs 3,500 crore by Daiichi Sankyo in a case related to the sale of Ranbaxy Laboratories by Singh brothers.
The court directed the Singh brothers to submit list of unencumbered personal assets that need to be valued and liquidated.
The court also restrained RHC Holdings and Oscar Investments from operating bank accounts, however, it allowed RHC and Oscar Invests to operate bank accounts for salary and statutory dues.
The court said that each day's delay costs Singh brothers Rs 50 lakh in interest payments.
In April 2016, an arbitration tribunal in Singapore had ruled in favour of Daiichi, directing the Singh brothers to pay around Rs 2,563 crore in damages, plus interest of 4.44 percent per year from November 7, 2008 till the date of the award.
The tribunal found the brothers guilty of making false claims in a self-assessment report and of fraudulently misrepresenting and concealing the “genesis, nature and severity of the US regulatory investigations” of Ranbaxy when Daiichi bought their 34.82 percent stake for USD 2.4 billion in 2008.
"Looks like all their legal options in India are exhausted and they may have to pay up the arbitration award," said Shriram Subramanian, Founder and Managing Director of proxy advisory firm InGovern Research.
Subramanian said the order may not impact the efforts of Fortis Healthcare to bring in a strategic investor as Singh brother hold little over 3 percent stake.
Shares of Fortis Healthcare declined 1.06 percent and were trading at 158.25 on BSE at 2.45 pm, while the benchmkark Sensex gained 0.94 percent to 34,463.95 points.
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