PTL Enterprises: That Old Sinking feeling!

On August 30, 2014, PTL Enterprises published its AGM notice, in which it has presented a resolution for the sale of the hospital business. The following details emerged:1.       PTL’s two subsidiaries, Artemis Health Sciences Ltd. (AHSL) and Artemis Medicare Services Ltd. (AMSL; a step down subsidiary of PTL) are being sold to Leto Healthcare Private Limited (LHPL), which is a related party: Onkar Kanwar (promoter) being the interested party on both sides of the transaction. 2.       The rationale for the sale:   healthcare is a non-core business and therefore a strategic exit from this business will enable the company to focus on its core operations. 3.       Total consideration of Rs.2.03 bn, which comprises Rs.1.81 bn towards shares, Rs.0.19 bn towards loan assignment and Rs.0.02 bn (adds up to 2.02) towards sale of hospital equipment owned by PTL and leased by its subsidiaries.A few large retail shareholders approached IiAS to help protect their rights as minority investors. The investors  raised concerns saying that the hospitals were being sold to the promoters for a steal. Additionally, investors held the view that beyond the hospital sale transaction, PTL also owns 31 acres of land in central Kochi – they were afraid that, in a similar transaction, PTL would sell the land to promoters for very low valuations. Thus, non-promoter shareholders would be deprived of the fundamental value of their shareholding.IiAS ran some standard tests, and these test and summary results are given below:

You can read IiAS’ observations, its analysis of the ailments, the diagnosis and its prescription in its reports…attached here.

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