Fortis Malar Hospital shares surged 20 per cent to Rs 68.50, its maximum intraday limit on Bombay Stock Exchange after its parent company Fortis Healthcare announced a restructuring exercise.
Fortis Healthcare on Friday announced demerger of its diagnostic business SRL, which will be merged with Fortis Malar subsequently. Fortis Healthcare shares also gained as much as 3.5 per cent.
The existing hospital business of Fortis Malar Hospital will be transferred to Fortis Healthcare and Fortis Malar Hospitals will be renamed SRL post the merger of diagnostic business with it.
Shareholders of Fortis Healthcare will get 98 shares of SRL for every 100 shares held in the company.
Fortis Malar Hospital had come into existence in 2007 after Fortis Healthcare acquired stake in Chennai-based Malar Hospital. Currently Fortis Malar Hispital also has its own diagnostic business.
Post the demerger all the hospitals business of Fortis Group will remain under Fortis Healthcare and the diagnostic business will move to Fortis Malar Hospital, which will be renamed as SRL, said Bhavdeep Singh, CEO of Fortis Healthcare, to NDTV Profit.(Watch)
The demerger of Fortis Healthcare's diagnostic business will unlock value for shareholders, analysts said. Share offerings of diagnostic services providers Thyrocare Technologies and Dr. Lal PathLabs have witnessed huge interest from investors and their shares have outperformed the broader indices after listing.
"Apart from unlocking shareholder's value, it (demerger) gives us two strong independent operating businesses with dominating positions in their respective areas," Mr Singh said.
Fortis Malar Hospital shares closed with 20 per cent gains at Rs 68.50 while Fortis healthcare shares closed down 3.12 per cent at Rs 181.90. In comparison the broader Nifty ended down 0.31 per cent.
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