"Market is betting that they would be exiting at profit," Jagannadham Thunuguntla, equity head at SMC Capitals in New Delhi, said on Thursday. "If Fortis wants to go ahead, then naturally they will have to write a big cheque."

1. Khazanah's $835 mln Parkway bid in challenge to Fortis
By Harry Suhartono and Julie Goh
SINGAPORE/KUALA LUMPUR, May 27 (Reuters) - Malaysian sovereign wealth fund
Khazanah launched an $835 million bid for control of Parkway Holdings (PARM.SI), potentially
pitting it against India's Fortis Healthcare (FOHE.BO) in a battle for Singapore's largest private
healthcare provider.
The surprise offer, which aims to lift Khazanah's stake in Parkway to 51.5 percent, could either
trigger a takeover fight or force Fortis to cash out of the medical firm, which operates 16
hospitals in Singapore, Brunei, Malaysia, India and China.
Shares in Fortis, which had hoped to use Parkway as a springboard for expansion, ended 7.6
percent higher, a sign that some investors expect Indian billionaire Malvinder Singh, whose
family controls Fortis, to sell out.
"Market is betting that they would be exiting at profit," Jagannadham Thunuguntla, equity
head at SMC Capitals in New Delhi, said on Thursday. "If Fortis wants to go ahead, then
naturally they will have to write a big cheque."
Others suggested Singh, who with his brother Shivinder has a fortune estimated by Forbes at $3
billion, may make its own offer.
"We think this potentially could be the start of a bidding war. Khazanah has the option of turning
its partial offer to a full GO (general offer) should they choose to do so. Both parties have
professed to be able to drive more value out of Parkway," UBS analyst Jaj Singh wrote in a note
on Thursday.
Khazanah's offer comes just two months after Fortis, which runs hospitals in India, bought a 23.9
percent stake in Parkway from U.S. buyout firm TPG for $685 million.
Fortis' stake has since risen to 25 percent. It had said in March it had no immediate plans to raise
its stake. [ID:nSGE62A0DD].
Singh, 37, stepped down as chairman of Indian financial services group Religare Enterprises Ltd
(RELG.BO) in April to focus on healthcare. He recently shifted his base from Delhi to
Singapore, where he became chairman of Parkway. [ID:nSGE6350A8]
His family controlled Indian drugmaker Ranbaxy Laboratories (RANB.BO) before selling to
Japan's Daiichi Sankyo (4568.T) in 2008. Malvinder Singh and his younger brother ranked 17th
on Forbes magazine's 2009 list of the richest Indians.
Khazanah is offering S$3.78 a share to raise its stake from nearly 24 percent, more than what
Fortis paid in March, when its deal valued Parkway at S$3.56 a share. The deal would be
Khazanah's biggest acquisition outside Malaysia, according to Thomson Reuters data.

2. Spokeswomen for Fortis and Parkway had no immediate comments on Khazanah's offer.
"Khazanah has identified healthcare as one of the core areas that they want to go into," said Ang
Kok Heng, chief investment officer at Kuala Lumpur-based Phillip Capital.
In 2006, Khazanah bought into hospital operator Pantai Holdings, which has a network of nine
hospitals in Malaysia. "This offer shows that they're moving towards that same direction," Ang
said.
The sovereign wealth fund holds a stake in Fortis' rival Apollo Hospitals (APLH.BO), India's
largest hospital chain. Apollo shares ended 9.4 percent higher in Mumbai.
Khazanah is planning its first Singapore dollar bond issue to raise between S$300-500 million,
said IFR, a Thomson Reuters service. [ID:nSGE64Q05S]
SINGAPORE-MALAYSIA TIES
The Malaysian fund's bid for Parkway comes a week after the leaders of both countries agreed
last week to resolve long-standing disputes over land and water that have plagued ties for the
past 20 years.
Under one of the agreements, the two countries said the Malayan Railway land will be developed
by a 60:40 joint venture between Khazanah and Singapore state investor Temasek TEM.UL.
In March, Temasek's subsidiary ST Telemedia bought a $300 million stake in Malaysia's U
Mobile Sdh Bhd.
The bid by Khazanah's Integrated Healthcare unit is a 25 percent premium over Parkway's last
traded price. If the offer is accepted, it will pay S$1.18 billion ($835 million) to raise its Parkway
stake to 51.5 percent.
CIMB and Deutsche are Khazanah's financial advisers.
Khazanah said the group plans to consolidate its existing stakes in Parkway, Pantai, Apollo and
IMU to become Asia's premium regional healthcare platform.
Trading in Parkway shares was suspended in Singapore. Parkway shares have risen 3.4 percent
so far this year, outperforming a 7 percent drop in the broader Singapore Straits Times Index
.FTSTI. ($1=1.413 Singapore Dollar) (Additional reporting by Soo Ai-Peng in KUALA
LUMPUR, Sanjeev Choudhary in NEW DELHI and Kevin Lim in SINGAPORE; Writing by
Saeed Azhar; Editing by Anshuman Daga and Tony Munroe)