A EMPIRICAL STUDY ON MERGERS AND ACQUISITION ON ITS

DOWNFALL AND BENEFITS IN THE FIELD OF HEALTH SECTOR

(FORTIS).

INDUSTRIAL INTERNSHIP REPORT SUBMITTED IN PARTIAL FULFILLMENT OF THE

REQUIREMENTS FOR THE AWARD OF THE DEGREE OF

MASTER OF BUSINESS ADMINISTRATION

OF
BENGALURU CITY UNIVERSITY

By

GOUTHAM.R

REG NO: P18BR21M0066

Under the guidance of

MRS. BINDHUSHREE.K

Assistant Professor

BRINDAVAN COLLEGE
DWARAKANAGAR, YELAHANKA, BANGALORE-560 063
2022-2023
 DECLARATION BY THE STUDENT

I hereby declare that the “A EMPIRICAL STUDY ON MERGERS AND

ACQUISITION ON ITS DOWNFALL AND BENEFITS IN THE FIELD OF
HEALTH SECTOR (FORTIS).” is the result of the work carried out by
GOUTHAM.R under the guidance of MRS.BINDHUSHREE.K in the partial
fulfillment for the award of the Master’s Degree in Business Administration by
Bangalore Central University.

I also declare that this report is the outcome of my own effort and that it has not
been submitted to any other University or Institute for the award of any other
Degree/Diploma/Certificate. I also declare that the business immersion report is
not presented in any forum earlier than this.

PLACE: NAME: GOUTHAM.R

DATE: REG NO: P18BR21M0066

 GUIDE CERTIFICATE

This is to certify that the Industrial Internship Report “A EMPIRICAL STUDY

ON MERGERS AND ACQUISITION ON ITS DOWNFALL AND
BENEFITS IN THE FIELD OF HEALTH SECTOR (FORTIS)” Submitted by
GOUTHAM.R P18BR21M0066 to Bangalore City University, Bangalore for the
award of Degree of Master of Business Administration is a record of work carried
out by him/her under my guidance.

Place: Bangalore

Date: Signature:
 ACKNOWLEDGEMENT
The research on “A EMPIRICAL STUDY ON MERGERS AND
ACQUISITION ON ITS DOWNFALL AND BENEFITS IN THE FIELD OF
HEALTH SECTOR (FORTIS)” has been given to me a part of the curriculum in
Master Degree in Business Administration.

I hereby acknowledge my sincere gratitude and indebtedness to Mr. PRASANT,

Principal of Brindavan College for being so kind to allow me to pursue my interest
in the subject and by giving her valuable guidance throughout the preparation of
this project.

I would also like to Thank Dr. SHASHIKALA (HOD), of MBA Brindavan

College who was always there for me and helped me with all the details as and
when required.

I place my record, my sincere gratitude to Mrs. BINDHUSHREE.K my project

guide for their encouragement and effective guidelines. I will be failed in my duty
if I do not acknowledge the esteemed scholarly guidance, assistance and
knowledge I have received from them towards fruitful and timely completion of
this work.

I also thankful to my seniors and as well as my friends who helped me a lot in the
completion of this project.

Place: Bangalore Name: GOUTHAM.R

Date: Reg No: P18BR21M0066

 EXECUTIVE SUMMARY
The Report aim to Analyze & document of the organizational structure of Fortis
Hospital, including its hierarchy, departments, and reporting relationships. This
Organization helps in understanding how the hospitals functions and how different
units interact.

The Report can focus on studying the workflow and processes within Fortis
Hospital. This involves identifying key processes such as patient admission,
treatment protocols, discharge procedures, and administrative tasks. By evaluating
these processes, the study can identify areas for improvement and suggest changes
to enhance efficiency and patient care.

The study can focus on examining the human resources management practices of
Fortis Hospital. This includes analyzing recruitment and selection processes,
employee training and development programs, performance management systems,
and employee satisfaction and engagement initiatives. The objective is to assess
how the hospital attracts and retains talent and how it supports the professional
growth of its staff.

Another Main objective could be to evaluate the quality of care and patient safety
practices at Fortis Hospital. This may involve analyzing protocols for infection
control, medication management, patient monitoring, and adherence to regulatory
standards. The study can identify areas where improvements can be made to
enhance patient safety and the overall quality of healthcare delivery.

The Report may aim to identify strategic opportunities for Fortis Hospital. This can
involve Analyzing market trends, competition, and patient demographics to
identify potential areas for expansion or service diversification. The objective is to
provide insights and recommendations that can help the hospital in its long-term
planning and growth.
 TABLE OF CONTENT
CHAPTER TITLE PAGE NO
NO
I. INTRODUCTION. 1-4
1.1 OVERVIEW OF THE TOPIC. 5-8
1.2 THEORETICAL BACKGROUND OF THE STUDY. 9-11
1.3 EXPLANATION FOR RELATED CONCEPT OF 12-16
SELECTED RESEARCH.
II. ORGANIZATIONAL PROFILE. 17
2.1 INTRODUCTION TO THE ORGANIZATION. 18-19
2.2 COMPANY PROFILE. 20-26

2.3 PRODUCT AND SERVICE PROFILE. 27-30

2.4 VISSION AND MISSION OF FORTIS HOSPITAL. 31-34

2.5 MCKINSEYS 7-S FRAMEWORK OR BUSINESS 35-42

CANVAS MODEL.
III. REVIEW OF LITERATURE AND 43-45
RESEARCH DESIGN.
3.1 REVIEW OF LITERATURE AND GAPS. 46-48

3.2 STATEMENT OF THE PROBLEM. 49-52

3.3 NEEDS FOR THE STUDY. 53-55

3.4 SCOPE OF THE STUDY. 56-60

3.5 OBJECTIVES OF THE STUDY. 61-64

3.6 HYPOTHESES. 65-68

3.7 SAMPLING FRAMEWORK. 69-75

3.8 DEMOGRAPHIC OUTLINE OF THE RESPONDENTS. 76-78

3.9 TOOLS FOR DATA COLLECTION. 79-81
3.10 DOWNFALL, BENEFITS, LIMITATION OF THE 82-90
STUDY.
IV. SWOT ANALYSIS 91
4.1 STRENGTH 92

4.2 WEAKNESS 93

4.3 OPPORTUNITY 93

4.4 THREATS 94

V. DATA ANALYSIS AND INTERPRETATION 95

5.1 DETAILS OF TOOLS USED FOR DATA ANALYSIS. 96-99

5.2 DATA ANALYSIS AND INTERPRETATION. 100-128

5.3 TECHNOLOGY AND HIERARCHY USED IN DATA 129-132

ANALYSIS.

VI. SUMMARY OF FINDINGS, CONCLUSION, 133

AND SUGGESTIONS.
6.1 SUMMARY OF FINDING. 133-134

6.2 MY LEARNING EXPERIENCE IN FORTIS 135-136

HOSPITAL.
6.3 CONCLUSION. 137-138

6.4 SUGGESTION TO THE ORGANISATION. 139-140

VII. REFERENCE AND BIBLIOGRAPHY. 141-142

VIII. ANNEXURE. 143-145

 LIST OF TABLES
CHAPTER NO DESCRIPTION PAGE NO
5.2.1 TABLE SHOWING OVERVIEW OF FINANCIAL 100-105
DATA ANALYSIS.
REVENUE DATA. 100
NET PROFIT. 101
EPS (earning per share). 102
BVPS. 103
ROE (rate of earning). 104
DEBT TO EQUITY. 105
5.2.2 TABLE SHOWING DATA ANALYSIS OF 106-109
INCOME STATEMENT.
QUARTERLY. 106
HALF YEARLY. 107
NINE MONTHS. 108
ANNUALY. 109
5.2.3 TABLE SHOWING BALANCE SHEET 110-111
ANALYSIS.
5.2.4 TABLE SHOWING PROFIT AND LOSS 112-114
ANALYSIS.
5.2.5 TABBLE SHOWING CASHFLOW DATA 115-116
ANALYSIS.
5.2.6 TABLE SHOWING CAPITAL STRUCTURE 117-118
ANALYSIS.
5.2.7 TABLE SHOWING DATA ANALYSIS OF 119-126
RATIOS.
PER SHARE RATIOS. 119
MARGIN RATIOS. 120
RETURN RATIOS. 121
LIQUIDITY RATIOS. 122
LEVERAGE RATIOS. 123
TURNOVER RATIOS. 124
GROWTH RATIOS. 125
VALUATION RATIOS. 126
5.2.8 TABLE SHOWING CHANGE IN WORKING 127
CAPITAL.
5.2.9 TABLE SHOWING TREND ANALYSIS OF 128
SALES.
 LIST OF FIGURES
CHAPTER NO DESCRIPTION PAGE NO
5.2.1 CHART SHOWING OVERVIEW DATA 100-105
ANALYSIS.
REVENUE DATA. 100
NET PROFIT. 101
EPS (earning per share). 102
BVPS. 103
ROE (rate of earning). 104
DEBT TO EQUITY. 105
5.2.2 CHART SHOWING ANALYSIS OF 106-109
INCOME STATEMENT.
QUARTERLY. 106
HALF YEARLY. 107
NINE MONTHS. 108
ANNUALY. 109
5.2.7 CHART SHOWING RATIOS ANALYSIS. 119-126
PER SHARE RATIOS. 119
MARGIN RATIOS. 120
RETURN RATIOS. 121
LIQUIDITY RATIOS. 122
LEVERAGE RATIOS. 123
TURNOVER RATIOS. 124
GROWTH RATIOS. 125
VALUATION RATIOS. 126
5.2.8 CHART SHOWING CHANGES IN TREND 127
ANALYSIS OF SALES.

5.2.9 CHART SHOWING CHANGES IN 128

WORKING CAPITAL.
 ABSTRACT
Mergers and acquisitions (M&A) have become prevalent in the healthcare sector,
often presenting an intriguing blend of opportunities and challenges. This empirical
study delves into the dynamics of M&A within the healthcare industry, with a
specific focus on Fortis Healthcare as a case study. The objective is to analyze the
outcomes, both positive and negative, of M&A activities in the context of the
health sector, shedding light on their impacts on Fortis Healthcare's overall
performance.

This research employs a mixed-methods approach, combining quantitative analysis

of financial data and qualitative assessments through interviews with key
stakeholders. Financial indicators such as revenue growth, profitability, and
efficiency ratios are examined to quantify the benefits and downfalls of M&A
activities at Fortis Healthcare. Additionally, interviews with executives, healthcare
professionals, and patients provide valuable insights into the broader implications
of these strategic decisions.

The findings reveal a nuanced picture of M&A outcomes in the healthcare sector.
On the positive side, M&A activities have led to increased market presence,
enhanced service offerings, and improved operational efficiency for Fortis
Healthcare. However, challenges such as post-merger integration issues, cultural
clashes, and regulatory complexities have also been identified as significant
downfalls. These factors have sometimes resulted in short-term disruptions and
uncertainty.

This study contributes to the growing body of literature on M&A in the healthcare
sector by providing a comprehensive analysis of the experiences of Fortis
Healthcare. The insights gained from this research can inform healthcare
organizations, policymakers, and investors about the complexities and potential
benefits of M&A in the health sector, helping them make more informed decisions
in an ever-evolving industry. Ultimately, a balanced understanding of the merits
and pitfalls of M&A in healthcare is crucial for ensuring the delivery of high-
quality care to patients while maintaining the financial sustainability of healthcare
organizations like Fortis.
 CHAPTER-1
INTRODUCTION
Mergers and Acquisitions (M&A) refer to the strategic processes by which
companies combine or acquire other businesses with the aim of achieving specific
objectives, such as growth, expansion, increased efficiency, or gaining a
competitive advantage. In the context of the healthcare sector, M&A activities play
a crucial role in shaping the landscape of healthcare providers and services. Fortis
Healthcare Limited, a prominent player in the healthcare industry, has experienced
both the benefits and challenges associated with M&A.

Introduction to Mergers and Acquisitions in the Healthcare Sector: The

healthcare sector is characterized by rapid technological advancements, increasing
demand for quality care, and evolving regulatory requirements. In response to
these dynamics, healthcare organizations often turn to mergers and acquisitions as
a strategic tool. Mergers involve the combination of two or more healthcare entities
into a single entity, while acquisitions involve one healthcare organization taking
control of another. In both cases, the overarching goal is to improve patient care,
enhance operational efficiency, and create a stronger, more competitive healthcare
provider.

Healthcare industry in India comprises of hospitals, medical devices, clinical trails,

outsourcing, telemedicine, medical tourism, health insurance, and medical
equipment. The Healthcare market functions through 5 segments:-

a) Hospitals:-
 Government hospital: It includes healthcare center, district hospital,
and general hospitals.
 Private hospital: It includes nursing homes, mid-tier, top-tier and
multispecialty hospitals.

b) Pharmaceutical:
It includes manufacturing, extraction, processing, purification and packaging
of chemical materials for use as medications for and animals.

1
 c) Diagnostics:
It comprises businesses and laboratories that offer analytical or diagnostic
services, including body fluid analysis.

d) Medical equipment and supplies:

It includes establishments primarily manufacturing medical equipments ans
supplies,
E.g.:- Surgical, dental, orthopedic, ophthalmologic, laboratory instruments.

e) Medical insurance:
It includes health insurance and medical reimbursement facility, covering an
individual’s hospitalization expenses incurred due to sickness.

Healthcare is the improvement of health via the prevention, diagnosis, treatment,

or cure of disease. Healthcare is delivered by health professionals and allied health
fields. It includes work done in providing primary care, secondary care, and
tertiary care, as well as in public health.
Access to healthcare may vary across countries, communities, and individuals,
influenced by social and economic condition as well as health policies. Providing
health care services means “The timely use of personal health services to achieve
the best possible health outcomes”.
Health systems are organization established to meet the health needs of targeted
populations. According to the World Health Organization (WHO), a well-
functioning healthcare system requires a financial mechanism, a well trained and
adequately paid workforce, reliable information on which to base decision and
policies, and well-maintained health facilities to deliver quality medicines and
technologies.
An efficient healthcare system can contribute to a significant part of the countries
economy, development and industrialization. Healthcare is conventionally
regarded as an important determinant in promoting the general physical and mental
health and well-being of people around the world. An example, of this was the
worldwide eradication of smallpox in 1980, declared by the WHO, as the first
diseases in human history to be eliminated by deliberate healthcare interventions.

2
WHO supports member states in taking the primary health care approach to
accelerate progress in achieving universal health coverage? Countries are
demonstrating how this strategy has been effective in strengthening their health
system to address people needs, both in times of crisis as in normal times.
The principles of primary health care were first outlined in the declaration of
Alma-Ata in 1978, a seminal milestone in global health. 40 years later, global
leader ratified the declaration of Astana at the Global Conference on Primary
Healthcare which took place in Astana, Kazakhstan in oct-2018.

To support members states in the translating this commitments into practical

actions that are aligned with national contexts and priorities, WHO established the
special program on primary healthcare and, together with UNICEF, released the
operational framework for primary health care and healthcare measurement
framework and indicators.

The health sector is a vital component of any society, encompassing a wide range
of activities and services aimed at promoting and maintaining the well-being of
individuals and communities. It plays a fundamental role in ensuring that people
have access to quality healthcare, enabling them to lead healthy and productive
lives.

The health sector includes various entities and organizations, such as hospitals,
clinics, pharmacies, healthcare professionals, public health agencies, and research
institutions, all working together to address the diverse health needs of populations.
Its importance extends beyond just the treatment of illnesses; it also encompasses
preventive measures, health education, and research to advance medical
knowledge.

In this introduction note, we will explore the multifaceted aspects of the health
sector, highlighting its significance, challenges, and the evolving landscape of
healthcare in the modern world. From the delivery of primary care to the
development of cutting-edge medical technologies, the health sector plays a critical
role in shaping the quality of life and longevity of individuals across the globe.

3
Universal health coverage will only be possible when everyone, everywhere can
access the health services they need. Communities should be empowered to
identify their health priorities and contribution to finding responsive solution.
Healthcare includes promoting policies and improves people health and well-being
prevention of non-communicable diseases, routine vaccination for children and
sexual and reproductive health services.

The impact is seen in the health system that focus on people’s needs and are as
close as feasible to their everyday environment. Primary healthcare oriented
consistently produce better outcome, enhance equity and improve efficiency.
Scaling up primary healthcare interventions across low and middle income
countries could save 60 million lives and increases average life expectancy by 3.7
years by 2030.

Hence healthcare focuses in bringing these factors together to ensure the highest
possible level of health and well-being and their equitable distribution.

Conclusion:

Mergers and acquisitions (M&A) in the field of the health sector represents a
significant and transformative trend that has the potential to shape the future of
healthcare delivery. As healthcare organizations strive to adapt to the evolving
landscape of medicine, these strategic alliances offer both opportunities and
challenges.

On the positive side, M&A in the health sector can lead to improved patient care
through the consolidation of resources, expertise, and infrastructure. It can also
enhance efficiency, reduce costs, and drive innovation as organizations pool their
resources and talent. Additionally, M&A can provide greater access to healthcare
services in underserved regions and foster the development of advanced medical
technologies and treatments.

4
 1.1 OVERVIEW OF THE TOPIC
The healthcare sector is a critical component of any society, providing essential
medical services to individuals and communities. It encompasses a wide range of
organizations, professionals, and technologies aimed at promoting health,
preventing diseases, diagnosing and treating illnesses, and improving overall well-
being. This comprehensive overview will delve into the various aspects of the
healthcare sector, including its historical development, current challenges, key
stakeholders, major trends, and the role of technology.

Historical Development:

The evolution of the healthcare sector has been a complex journey shaped by
scientific advancements, societal changes, and economic developments. In ancient
civilizations, healing practices were often intertwined with religious beliefs and
rituals. However, the foundations of modern medicine began to take shape with the
contributions of figures like Hippocrates, who emphasized empirical observation
and evidence-based medicine in ancient Greece.

During the Middle Ages, medical knowledge stagnated in Europe, but in other
parts of the world, such as the Islamic Golden Age, significant advancements were
made in fields like pharmacology and surgery. The Renaissance period saw the
revival of anatomical studies and medical knowledge in Europe, leading to major
breakthroughs in understanding human physiology.

The 19th and 20th centuries witnessed remarkable progress in healthcare, driven
by scientific discoveries, such as the identification of bacteria as the cause of
infectious diseases and the development of vaccines and antibiotics. The
establishment of modern hospitals and medical schools, as well as the
professionalization of medical practice, further transformed the healthcare
landscape.

The 20th century also saw the emergence of universal healthcare systems in
various countries, with the United Kingdom's National Health Service (NHS) in
1948 serving as a pioneering example. These systems aimed to provide equitable
access to healthcare for all citizens, regardless of their socioeconomic status.
5
Current Landscape:

Today, the healthcare sector is a multifaceted and highly complex industry that
varies significantly from one country to another. It comprises a diverse set of
stakeholders, including healthcare providers, insurers, pharmaceutical companies,
medical device manufacturers, government agencies, and patients.

Healthcare Providers: These include hospitals, clinics, nursing homes, and various
healthcare professionals such as doctors, nurses, pharmacists, and allied health
workers. These entities are on the frontline of healthcare delivery, providing
essential medical services to patients.

Health Insurance: Health insurance companies play a crucial role in financing

healthcare by providing coverage to individuals and organizations. This helps
mitigate the financial burden of medical expenses and ensures access to necessary
healthcare services.

Pharmaceutical and Medical Device Companies: The pharmaceutical industry

develops and manufactures drugs and therapies, while medical device companies
produce a wide range of products, from diagnostic equipment to surgical
instruments.

Government Agencies: Governments are responsible for regulating and overseeing

the healthcare sector, often funding public healthcare programs, setting healthcare
policies, and ensuring quality and safety standards.

Patients: Individuals seeking medical care are central stakeholders in the healthcare
sector. Patient rights, preferences, and engagement have gained prominence in
recent years, with a growing emphasis on patient-centered care.

Challenges in the Healthcare Sector:

Despite significant advancements, the healthcare sector faces a multitude of

challenges:

6
Access and Equity: Disparities in healthcare access persist globally, with many
individuals lacking adequate access to healthcare services due to factors like
income, geography, and socio-cultural barriers.

Quality and Safety: Ensuring high-quality care and patient safety remains a
challenge, as medical errors, infections, and suboptimal care can lead to adverse
outcomes.

Chronic Diseases: Non-communicable diseases, such as diabetes, cardiovascular

diseases, and cancer, are on the rise globally, placing a significant burden on
healthcare systems.

Aging Population: The aging demographic profile in many countries poses

challenges related to increased healthcare demands and the need for specialized
care for the elderly.

Technological Advancements: While technology has improved healthcare in

numerous ways, it also presents challenges, including data security,
interoperability, and the ethical implications of artificial intelligence in healthcare
decision-making.

Key Trends in the Healthcare Sector:

The healthcare sector is constantly evolving, driven by various trends and

innovations:

Digital Health: The integration of digital technologies, electronic health records

(EHRs), telemedicine, and mobile health apps is transforming healthcare delivery,
making it more accessible and patient-centric.

Precision Medicine: Advances in genomics and personalized medicine enable

tailored treatments based on an individual's genetic makeup, increasing treatment
efficacy and reducing adverse effects.

Artificial Intelligence (AI): AI is being used for diagnostics, predictive analytics,

drug discovery, and robotic surgery, enhancing both clinical decision-making and
administrative processes.
7
Value-Based Care: A shift from fee-for-service to value-based care models
incentivizes healthcare providers to focus on patient outcomes and cost-
effectiveness.

Population Health Management: A proactive approach to healthcare emphasizes

prevention and wellness, addressing the health of entire populations rather than just
individual patients.

Role of Technology:

Electronic Health Records (EHRs): EHRs enable healthcare providers to access

and share patient information securely, improving coordination of care and
reducing errors.

Medical Imaging: Advanced imaging technologies like MRI, CT scans, and

ultrasound provide detailed diagnostic information, aiding in disease detection and
treatment planning.

Robotics: Surgical robots and robotic-assisted procedures enhance surgical

precision, reduce invasiveness, and shorten recovery times.

AI and Machine Learning: AI algorithms analyze vast datasets to support clinical

decision-making, predict disease trends, and streamline administrative processes.

3D Printing: 3D printing technology is used to create customized implants,

prosthetics, and even organs for transplantation.

Conclusion

The healthcare sector is a dynamic and multifaceted field that has undergone
significant evolution over the centuries. From its historical roots in ancient healing
practices to its current state of high-tech innovation, healthcare continues to play a
crucial role in society. While facing challenges related to access, cost, and quality,
the sector also benefits from ongoing technological advancements that promise to
revolutionize healthcare delivery and improve patient outcomes. As the world
continues to change, the healthcare sector will remain a cornerstone of public well-
being and a focal point of innovation and progress.
8
 1.2 THEORETICAL BACKGROUND OF THE STUDY
Mergers and acquisitions (M&A) have been a significant strategy employed in the
healthcare sector to foster growth, improve operational efficiency, and enhance the
quality of patient care. This study delves into the theoretical background of M&A
in the healthcare industry, focusing on the case of Fortis Healthcare, a prominent
player in the Indian healthcare sector. Through a detailed analysis, we explore the
benefits and downfalls associated with mergers and acquisitions in the healthcare
sector, shedding light on the specific challenges and opportunities faced by Fortis
in the early 2000s.

Introduction:

The healthcare industry plays a pivotal role in society, addressing the healthcare
needs of individuals and communities. In recent years, the industry has witnessed a
surge in mergers and acquisitions as healthcare organizations seek to adapt to
changing dynamics, regulatory pressures, and economic challenges. Fortis
Healthcare, a leading player in the Indian healthcare sector, provides an intriguing
case study to understand the implications of M&A in healthcare. This study aims
to examine the theoretical underpinnings, benefits, and downfalls associated with
mergers and acquisitions in the healthcare sector, with a focus on Fortis Healthcare
in the early 2000s.

Theoretical Background:
a) Scale and Efficiency: Mergers and acquisitions are often pursued to achieve
economies of scale, allowing healthcare organizations to reduce costs through the
consolidation of resources, facilities, and operations. Increased scale can lead to
improved negotiation power with suppliers and payers, potentially reducing the
overall cost of medical supplies and insurance.

b) Improved Access to Capital: M&A transactions can provide healthcare

organizations with access to additional capital, enabling them to invest in state-of-
the-art medical technology, research, and infrastructure development.

9
c) Geographical Expansion: Mergers and acquisitions allow healthcare providers to
expand their geographical footprint, reaching a wider patient base and tapping into
new markets.

d) Synergy: Synergy is a key driver of M&A in healthcare, where the combined

entity can leverage the strengths and expertise of each organization to improve
patient care and outcomes.

e) Diversification: Healthcare organizations often diversify their service offerings

through M&A to reduce dependency on a single revenue stream, thus mitigating
risks associated with healthcare sector volatility.

Case Study: Fortis Healthcare in the 2000s

In the early 2000s, Fortis Healthcare embarked on a series of mergers and

acquisitions to expand its presence in the Indian healthcare sector. The notable
acquisitions during this period included the acquisition of Wockhardt Hospitals
and Escorts Heart Institute. These strategic moves aimed to strengthen Fortis'
position as a leading healthcare provider in India.

Benefits Realized by Fortis:

a) Scale and Efficiency: Fortis achieved economies of scale by consolidating its

operations and sharing resources across its network of hospitals.

b) Enhanced Clinical Capabilities: The acquisitions brought specialized medical

expertise, allowing Fortis to offer a wider range of medical services.

c) Geographical Expansion: Fortis expanded its geographical footprint,

establishing a strong presence in major Indian cities.

10
Downfalls Faced by Fortis:

a) Integration Challenges: The integration of acquired hospitals and their systems

posed significant challenges, leading to temporary disruptions.

b) Financial Strain: The high cost of acquisitions and associated debt burden
strained Fortis' financial resources, impacting its ability to invest in research and
development.

c) Regulatory Scrutiny: Fortis faced regulatory scrutiny, including investigations

related to corporate governance issues, which affected its reputation.

Conclusion:

Mergers and acquisitions in the healthcare sector offer both significant benefits and
potential downfalls. Fortis Healthcare's experience in the early 2000s serves as a
valuable case study illustrating the complexities and outcomes of such strategic
moves. While Fortis realized benefits in terms of scale, enhanced clinical
capabilities, and geographical expansion, it also faced integration challenges,
financial strain, and regulatory scrutiny.

Healthcare organizations contemplating M&A must carefully weigh these factors,

conduct thorough due diligence, and prioritize patient care and experience
throughout the process. The success of M&A in the healthcare sector depends on a
nuanced understanding of the industry's unique dynamics and a strategic approach
that aligns with the organization's mission and values.

11
 1.3 EXPLANATION FOR RELATED CONCEPT OF
SELECTED RESEARCH.
Mergers and acquisitions (M&A) have long been a prominent strategy in the
healthcare sector. These transactions involve the consolidation of healthcare
organizations, including hospitals, pharmaceutical companies, and biotechnology
firms, through mergers, acquisitions, or partnerships. The healthcare industry is a
critical sector, with profound implications for public health and the economy.
Therefore, it is essential to thoroughly examine the benefits and downfalls of M&A
activities within this sector. This research aims to provide a comprehensive
understanding of how mergers and acquisitions have impacted the health sector,
focusing on the year 2000 as a pivotal point in its history.

Historical Context of Mergers and Acquisitions in the Health Sector:

To comprehend the evolution of M&A activities in the health sector, it is essential

to examine the historical context. The healthcare industry in the United States has
undergone significant changes over the past century. Before the 20th century,
healthcare was primarily fragmented, with independent hospitals and clinics
serving their communities. However, with advancements in medical technology,
changing healthcare policies, and the pursuit of economies of scale, the industry
began to see a surge in mergers and acquisitions in the latter half of the 20th
century.

The healthcare sector includes many industries, sub-industries, and a wide variety
of companies. Any company involved in products and services related to health
and medical care are represented in the healthcare sector and further categorized
under six main industries. These industries include pharmaceuticals, biotechnology,
equipment, distribution, facilities, and managed health care. In this report, we will
discuss each industry in further detail, highlighting the various aspects of the
supply chain as well as discuss the healthcare sector and its relation to the overall
market.

12
Pharmaceuticals:

The pharmaceutical sub-industry has been interesting to follow lately because of

these affects that the Affordable Care Act have had on it. When the Affordable
Care Act first was signed into law the sub-industry struggled at first because of the
new costs that stemmed from the bill. Those costs did not end up holding these
firms back because once 2014 started a lot of firms, including Regeneron
Pharmaceuticals, reported high revenues in their earnings reports. This is most
likely because of all the new patients that the Affordable Care Act has given
coverage to and thus allowing them to enter the market.

Biotechnology:

The biotechnology industry’s constituents derive their value from their ability to
develop, manufacture and market novel, patented medicines that generate
multibillion dollar revenues (Wang). Compared to pharmaceutical companies,
biotechnology firms are regarded as younger, faster growing and more innovative
(Wang). Biotech companies also differ from pharmaceutical companies because
they seek to develop new drug therapies strictly using biological processes rather
than the chemical processes. Biological processes use living factories such as
microbes or cell lines that are genetically modified to produce treatments
(Biotechnology by Amgen).Examples of treatments are as common as insulin
injections and as complex as using gene therapy to replace defective genes in
patients. Over the last year the biotech industry has seen considerable growth
compared to the S&P 500. Comparing the performance of the NASDAQ
Biotechnology Index (NBI) and the S&P 500 ETF Trust (SPY), the biotech
industry has outperformed the S&P 500 by 60.20% (Yahoo Finance).

13
Equipment:

Like drug companies, equipment is another important product of healthcare. The

equipment industry consists of manufacturing of healthcare equipment and medical
devices, creating product such as medical instruments, drug delivery systems,
cardiovascular and orthopedic devices and diagnostic equipment (investing). These
products are distributed to hospital and doctors and are used in the medical
treatment of patients. Medtronic is an example of an equipment company that
specializes in producing devices that are implanted into patients during surgical
procedures. As for its valuation ratios, they are all significantly lower than the
sector average. Although this can indicate a somewhat cheap stock, all the ratios
are very much in line with the equipment industry average (Medtronic). With so
many drug and equipment companies continuously creating products, there is need
for a distribution industry.

Distribution:

Distribution in an essential part of the healthcare sector supply chain. It represents

all distributors and wholesalers of health care products. This can include
companies anywhere frompharmacies to wholesalers of equipment. With more and
more drugs and equipment being produced, the distribution industry is quickly
growing. For example AmerisourceBergen, one of America’s largest distribution
companies, has had a 485% increase in stock price over the last five years
(AmerisourceBergen Corp). With a successful distribution industry, drug and
equipment companies are able to effectively get their products to hospitals and
other health care facilities.

Facilities:
Healthcare facilities are the health care providers in the healthcare sector. It it
where medicines are delivered to needing patients and where doctors practice
medicine. In this sub-industry, companies provide a wide range of health care and
social services through hospitals, doctors' offices, nursing homes, outpatient
surgery centers, and other facilities. In the last two years, the industry growth is
lower than the average healthcare sector growth.
14
 The healthcare facilities industry is under great pressure of revenue growth. The
hospital industry has a combined revenue of $ 700 billion per year, but the top 50
organizations generate less than 30 percent of revenue (first research inc.). Cost is
relatively high in this industry because hospitals need expensive equipment such
CT and MRI machines in order to operate. Another cost factor is the labor cost,
sometimes making up as high as 40% of total revenue. The current trend for the
industry is merging with competing facilities or even health insurance companies
in order to provide more cost-effective care.

Sector Expenses:

The healthcare sector is characterized by their substantial research and

development spending. On average, it costs $5 billion for a company to take a
product through the development life cycle over a 10 to 15 year period (Herper).
While some products that undergo phase trials will be approved create substantial
revenues for their parent companies, many will fail. Product that are rejected by
regulatory bodies or abandoned because of concerns with safety of efficacy are
merely sunk costs. The considerable costs incurred to develop products highlights
the importance for companies to carefully allocate research and development
expenditures to treatments with a high success probability that can secure long
periods of patent exclusivity. If pharmaceutical and biotech industry constituents
fail to do so, their product portfolio will lack earnings growth that can take many
years to recover due to the long regulatory review period.

15
Conclusion:

Mergers and acquisitions have played a pivotal role in shaping the healthcare
sector, with both benefits and downfalls. In the year 2000, these transactions were
influenced by rising healthcare costs, technological advancements, changing
regulations, and the pursuit of growth and efficiency.

The benefits of M&A activities in the health sector include economies of scale,
improved access to capital, enhanced service delivery, research synergies, and
geographic expansion. These advantages can lead to cost savings, innovation, and
better patient care.

However, the downfalls of M&A activities in healthcare encompass increased

market consolidation, cultural integration challenges, regulatory and legal hurdles,
concerns about the quality of care, and potential disparities in patient access.

To navigate the complexities of M&A in the health sector, it is essential for

organizations to carefully consider the strategic implications, regulatory
requirements, and patient-centric approaches. While mergers and acquisitions can
offer significant advantages, they should be pursued with a clear understanding of
the potential risks and a commitment to delivering high-quality, accessible
healthcare to all.

As the healthcare industry continues to evolve, the lessons learned from M&A
activities in the past, including those in the year 2000, can inform future strategies
and policies aimed at improving the delivery of healthcare services and advancing
medical research and innovation.

16
 CHAPTER-2
ORGANIZATIONAL PROFILE
Mergers and acquisitions (M&A) in the healthcare sector have become
increasingly common as organizations seek to adapt to changing market dynamics
and deliver more comprehensive and efficient care. Here's an organizational profile
of M&A in the healthcare sector, including its benefits and potential downsides:

Organizational Profile of Mergers and Acquisitions in the Healthcare Sector:

Types of Mergers and Acquisitions:

1) Horizontal Mergers: These involve the consolidation of healthcare

organizations that offer similar services or operate in the same geographic area. For
example, when two hospitals in the same city merge to increase their market share.

2) Vertical Mergers: These involve the integration of healthcare organizations

that operate at different stages of the healthcare delivery process. For instance,
when a hospital acquires a primary care clinic or a pharmaceutical company
merges with a drug distribution company.

3) Conglomerate Mergers: These mergers involve healthcare organizations from

different sectors coming together. For example, a healthcare system might acquire
a health insurance company.

In summary, mergers and acquisitions in the healthcare sector can offer various
benefits, including cost savings, improved quality of care, and expanded access to
capital and services. However, they also come with challenges such as integration
difficulties, regulatory hurdles, and potential negative impacts on competition and
employees. Successful M&A in healthcare requires careful planning, execution,
and ongoing management to achieve the desired outcomes and deliver better
healthcare to patients.

17
 2.1 INTRODUCTION TO THE ORGANISATION
The healthcare sector Fortis, a critical component of any society, has been
witnessing a significant transformation in recent years. One of the key drivers of
this transformation is the strategic restructuring through mergers and acquisitions
(M&A). Mergers and acquisitions in the healthcare industry have become
increasingly prevalent as organizations seek to adapt to a rapidly evolving
landscape marked by technological advancements, changing patient expectations,
and regulatory reforms. This essay explores the organization of mergers and
acquisitions in the healthcare sector, shedding light on the motives, challenges, and
strategies involved in these strategic moves. Includes:

Financial support for smaller health systems: A merger or acquisition may

occur when a smaller health system can no longer operate on its own without
financial support from an acquirer

Industry consolidation: Healthcare M&A further consolidates the industry by

combining entities and creating stronger, more valuable companies.

Mixed results on practice management: The impact of healthcare M&A on

practice management for hospitals and provider groups can vary, and there is no
single answer to how these transactions affect organizations.

Decline in hospital merger and acquisition activity during the COVID-19

pandemic: Hospital M&A activity experienced a slight decline in the first year of
the COVID-19 pandemic, and the trend continued in 2021. However, transaction
sizes grew, with 16 percent of sellers having over $1 billion in annual revenue.

All-time low in merger activity in the first quarter of 2022: The number and
size of healthcare M&A transactions hit an all-time low in the first quarter of 2022.

Enhancement of patient access to care: Partnerships, mergers, and acquisitions

have saved certain financially distressed hospitals from closure, preserving and
often enhancing patient access to care.

18
Consideration of value-based payment programs: Hospitals and health systems
are assuming risk under value-based payment programs designed to drive down the
total cost of care. M&A transactions can help mitigate these challenges by gaining
new capabilities, realizing new efficiencies, and spreading costs over a larger
organization.

Importance of IT integration: Successful healthcare M&A requires careful

consideration of IT integration. Ripping and replacing existing IT systems, such as
electronic medical records (EMRs), may not be the key to success.

Fortis Healthcare is a renowned name in the Indian healthcare landscape, with a

substantial presence in various countries. As a testament to its commitment to
quality healthcare, the organization has been actively involved in several M&A
activities over the years. These strategic moves have propelled Fortis into a
position of influence within the industry, but they have also posed unique
challenges.

This paper delves into the organizational dynamics of mergers and acquisitions
within the health sector, drawing on Fortis Healthcare as a compelling case study.
It aims to provide a comprehensive understanding of the complexities involved,
including regulatory hurdles, financial implications, and the impact on patient care.
By exploring Fortis's experiences, we can gain valuable insights into the evolving
landscape of M&A in healthcare.

In the field of healthcare, mergers and acquisitions (M&A) involve the

combination of two or more healthcare companies, hospitals, or physician
practices. The primary goals of these transactions are to lower healthcare costs and
improve the quality of care M&A activity in the health sector can have various
impacts on practice management.

19
 2.2 COMPANY PROFILE FORTIS HEALTHCARE

HISTORY

Fortis healthcare ltd was incorporated on February 28-1996. The company

commenced their commercial operation by setting up the Fortis heart institute and
multi-specialty hospital at Mohali in the year 2001. The founder of Fortis
healthcare was Shivinder Mohan Singh and Malvinder Mohan Singh. In 2018
Fortis healthcare limited has been merged with the Manipal hospital and TPG
Capital acquired Fortis healthcare limited as part of a deal for worth of Rs.39000
million. In 2019, Fortis healthcare announced that it had completed the acquisition
of RHT Health Trust assets for an enterprises value of Rs.46500 millions. In the
same financial year, Fortis reported a consolidated net profit of Rs.780.10 millions
for the quarter ended on 30th June.

Fortis healthcare limited is one of India’s foremost multi-specialty healthcare

providers catering to both India and International patients. A leader in the areas of
education and healthcare, our commitment to the overall well-being of an
individual is at the core of everything we do. Through our network of hospitals and
experienced team of medical professionals, we provide quality and affordable
healthcare to everyone.

20
Fortis Hospital operates a multi-specialty healthcare framework with hospitals
chain in India. It offers an integrated range of healthcare services from outpatients
treatment and diagnostics to advanced clinical care which also extends to
personalized home-care services.

Fortis Healthcare Limited (FHL) is one of the largest healthcare services providers
in India with 27 Hospitals, 4500 operational beds and over 426 diagnostics centre
as of 31 March 2023. The hospital offers a full spectrum of integrated healthcare
services ranging from clinics to quaternary care facilities and a wide range of
ancillary services to patients in area such as Cardiac care orthopedics,
Neurosciences Oncology, Renal care Gastroenterology and Mother or child care.
They are delivering quality healthcare services to patients in modern facilities
using advanced technologies.

FHL currently owns a fully diluted stake of 56.6% in SRL Fortis Healthcare Ltd
was incorporated on Feb 28 1996. The company commenced their commercial
operation by setting up the Fortis Heart Institute and Multi-specialty Hospital at
Mohali in the year 2001.
21
In December 2002 international hospital ltd became a board controlled subsidiary
of the company. In August 2003 Fortis hospital in Amritsar was inaugurated. In
October 2003 the company executed an agreement with Seth Jessa Ram and Bros
Charitable Hospital Trust for the operation and management of Jessa Ram Hospital
New Delhi and Fortis hospital in Noida was commissioned in August 2004. In
September 28 2005 the company acquired 90% interest in Escort Heart institute &
research center ltd that owns and operates three hospital in north India and operates
a fourth hospital in collaboration with the government of Chhattisgarh. In the year
2012-13 Fortis Healthcare Ltd launched two new hospitals in India one in Kangra,
Himachal Pradesh and the other one in Dehradun, Uttarakhand. In May 2013 the
issue committee of the Board of Directors of Fortis hospital allocated 3,49,93,030
equity shares of the company at an issues price of Rs.92 per equity share
aggregating to Rs.3219.4 million under the institutional placement programmed
(IPP) undertaking the company. In September 2015 Fortis Healthcare launched La
Femme a comprehensive and distinctive boutique hospital for women offering a
holistic range of medical services catering to all the stages of a woman’s life ay
Richmond Road Bangalore. Fortis La Femme has been conceptualized keeping in
mind contemporary women and the multiple roles they play. During the course of
FY 2020-21 company launched new medical programmes and clinical services at
its various facilities across the country. A Home Isolation Support Programe for
COVID-19 positive patients was launched by Fortis Memorial Research Institute
(FMRI) Gurugram. Fortis Anandapur Kolkata launched the city only dual source
dual energy somatom drive CT scanner which is 24 times faster than any other CT
scan machine. Fortis Hospital BG Road Bengaluru installed the first state of the art
Biplane Cath Lab in the state of Karnataka which will provide advanced care for
Neurovascular disorders. In 2022-23 Therapy Isolation ward and a preventive
Oncology Department came up at Fortis BG Road Bengaluru. A Lung Transplant
clinic and Pulmonary Medicine Unit was launched at Fortis Escort Jaipur whilst
the Fortis Institute of Blood Disorders was commissioned at Fortis Hospital
Mulund. Further a 12 bedded chemotherapy cancer daycare center was launched at
defence colony in New Delhi. Fortis Medical Center was opened in Srinagar
Jammu & Kashmir during March 2023 and Agilus Diagnostics Ltd are considered
as Material subsidiaries as on April 01 2023.
22
 Fortis Healthcare Limited, commonly known as Fortis, is one of India's leading
integrated healthcare providers. Established in 2001, Fortis has grown over the
years to become a prominent name in the Indian healthcare sector. This profile
aims to provide a detailed overview of Fortis Healthcare Limited in the year 2021.

Fortis Healthcare Limited traces its roots back to the early 2000s when it was
founded by Malvinder Mohan Singh and Shivinder Mohan Singh, the scions of the
Ranbaxy Laboratories family. The company embarked on its journey with the
mission to provide high-quality healthcare services to the people of India. Fortis
initially focused on the Northern region of India but soon expanded its footprint
across the country.

Corporate Structure:

Fortis Healthcare operates under a corporate structure that includes a network of

hospitals and clinics. The company's corporate office is located in Gurugram,
Haryana, India. Fortis also has a network of subsidiary companies and joint
ventures, which complement its healthcare offerings.

Key Hospitals and Facilities:

Fortis Healthcare Limited operates a network of multi-specialty hospitals, which

are strategically located in various cities across India. Some of the key hospitals in
the Fortis network include:

Fortis Memorial Research Institute, Gurugram

Fortis Hospital, Bangalore

Fortis Escorts Heart Institute, New Delhi

Fortis Hospital, Mohali

Fortis Hospital, Mumbai

These hospitals are equipped with state-of-the-art infrastructure, modern medical

equipment, and a dedicated team of healthcare professionals.

23
Medical Services and Specializations:

Fortis offers a wide range of medical services and specializations, covering almost
every aspect of healthcare. Some of the notable specializations and services
provided by Fortis include:

Cardiology and Cardiovascular Surgery

Orthopedics and Joint Replacement

Neurology and Neurosurgery

Oncology

Gastroenterology

Nephrology and Urology

Pediatrics and Neonatology

Organ Transplants

The comprehensive range of medical services ensures that Fortis can cater to the
diverse healthcare needs of its patients.

Technological Advancements:

Fortis Healthcare has always been at the forefront of adopting and integrating
cutting-edge medical technologies into its practice. This includes the use of robotic
surgery systems, advanced imaging techniques, telemedicine services, and
electronic health records (EHRs). These technological advancements enhance the
accuracy of diagnoses and the precision of medical procedures, ultimately leading
to better patient outcomes.

24
Quality of Care and Patient Experience:

Fortis is known for its commitment to delivering high-quality healthcare services.

The organization places a strong emphasis on patient-centric care, aiming to
provide a positive and comfortable experience for all patients. Fortis has received
numerous awards and accolades for its quality of care and patient safety initiatives,
further solidifying its reputation as a trusted healthcare provider.

Global Presence:

While Fortis Healthcare Limited primarily operates in India, it has made forays
into the global healthcare market through strategic partnerships and collaborations.
This includes the acquisition of healthcare facilities in other countries and the
establishment of international patient care services, attracting patients from
different parts of the world seeking specialized medical treatments.

Financial Performance:

Fortis Healthcare has shown steady financial performance over the years. The
company's revenue and profit margins have been positively impacted by its
expanding network of hospitals, increased patient trust, and the growing demand
for quality healthcare services in India. Fortis has also successfully attracted
investment from both domestic and international sources, further strengthening its
financial stability.

Corporate Social Responsibility (CSR):

Fortis Healthcare Limited is actively involved in various CSR initiatives aimed at

giving back to society. These initiatives focus on healthcare, education, and
community development. The company often conducts medical camps and
awareness programs in underserved areas, making healthcare more accessible to
marginalized populations.

25
Challenges and Controversies:

Like many large healthcare providers, Fortis has faced its share of challenges and
controversies over the years. These include allegations of overcharging patients,
regulatory compliance issues, and disputes among the company's stakeholders.
Such challenges have prompted Fortis to review and enhance its corporate
governance practices.

Future Outlook:

As of the knowledge cutoff date in September 2021, Fortis Healthcare Limited was
poised for continued growth and expansion. The company's commitment to
providing quality healthcare services and its ongoing investments in technology
and infrastructure indicated a positive outlook. However, the healthcare sector can
be influenced by various factors, including regulatory changes, competition, and
global health trends, which may impact Fortis' future trajectory.

Conclusion:

Fortis Healthcare Limited has emerged as a significant player in the Indian

healthcare industry, known for its commitment to quality care, technological
advancements, and a patient-centric approach. While it has faced challenges and
controversies, its dedication to healthcare excellence and community engagement
positions it as a prominent healthcare provider in India with a potentially bright
future. Please note that this profile is based on information available as of
September 2021, and developments may have occurred since then. As of 2021,
Fortis Healthcare Ltd was a company in transition, working to overcome past
challenges and rebuild its reputation. Its future prospects depended on its ability to
address financial, operational, and governance issues while maintaining a
competitive edge in the healthcare industry. To assess the current status and
outlook of Fortis Healthcare Ltd, it's advisable to consult the latest financial
reports, news, and industry analyses.

26
 2.3 PRODUCT AND SERVICES PROFILE (FORTIS
HEALTHCARE).
Fortis healthcare limited is a leading healthcare provider in India, known for its
commitment to delivering world-class medical care. Their facility is equipped
state-of-the-art-infrastructure and highly skilled team of healthcare professionals.
Fortis has been backed by over 150 senior doctors and 800 para-medical staff, the
facility offers super-specialty tertiary care services for about 40 specialties
including Fortis has its 5 hospital in Bangalore located at Cunningham road,
Bannerghatta road, Nagarbbhavi, Rajajinagar and Richmond town. All these
hospital are super specialty, tertiary care hospital with some of the best doctors in
the country. As per senses March 2023 the Fortis hospital it is named No.3 among
the best hospitals in the world and No.1 in India for Medical Tourism by the
Medical Travel and Tourism Quality Alliance (MTTQA). Fortis healthcare is one
of India’s largest healthcare provider with a trusted network of more than 20
hospitals, 4000 operational beds and 400 diagnostics centre. It takes a diverse team
of dedication employees to lead the transition to a lower-carbon energy future for
B.C. We proudly deliver renewable energy, natural gases, electricity and propane
to 1.2 million customers. The Fortis provide the highest paying job to the Senior
Consultant with a salary of Rs.46.6 Lakhs per year. The top 1% earn more than a
whopping Rs.48 Lakhs per year. Fortis, Inc. is a holding company, which engages
in the electric and gas utility industry. Below is an overview of the various
products and services offered by Fortis healthcare limited.

Medical Specialties:

Cardiology: Fortis Healthcare is renowned for its cardiology services, offering a

range of treatments for heart conditions. This includes angiography, angioplasty,
cardiac surgeries, and more.

Orthopedics: The facility provides orthopedic care, including joint replacements,

fracture management, and sports medicine services.

Oncology: Fortis offers comprehensive cancer care, including chemotherapy,

radiation therapy, and surgical interventions.
27
Neurology and Neurosurgery: The hospital has a dedicated team for neurology and
neurosurgery, treating conditions like strokes, brain tumors, and neurological
disorders.

Gastroenterology: Services related to the digestive system, such as endoscopy,

colonoscopy, and liver treatments, are available.

Obstetrics and Gynecology: Fortis Richmond Road provides maternity services,

including prenatal care, childbirth, and postnatal care.

Pediatrics: Pediatric care is available, with specialized services for children's health
needs.

Urology: Urological procedures and treatments, including kidney transplants, are

performed by skilled urologists.

Diagnostic and Imaging Services:

Radiology: The hospital is equipped with advanced radiology services, including
X-rays, CT scans, MRIs, and ultrasound.

Pathology: Laboratory services are available for comprehensive blood tests,

pathology tests, and diagnostic screenings.

Cardiac Imaging: Specialized cardiac imaging services, like echocardiography and

stress tests, are offered.

Endoscopy and Colonoscopy: These diagnostic procedures are available for

gastroenterological evaluations.

Emergency and Critical Care:

Emergency Department: Fortis Healthcare Limited provides 24/7 emergency

services for immediate medical attention.

ICU and Critical Care: The facility has intensive care units for critical patients,
equipped with advanced monitoring and life support systems.

28
Surgical Services:

General Surgery: General surgical procedures, such as appendectomies and hernia

repairs, are performed.

Minimally Invasive Surgery: Laparoscopic and minimally invasive procedures are

available for various conditions.

Cardiac Surgery: Complex heart surgeries, including bypass surgeries and valve
replacements, are performed by experienced cardiac surgeons.

Orthopedic Surgery: Joint replacements, spine surgeries, and arthroscopic

procedures are conducted by orthopedic specialists.

Specialized Clinics:

Diabetes Clinic: Fortis Richmond Road offers specialized diabetes care, including
education, management, and treatment.

Weight Management Clinic: Services for weight management and obesity-related

issues are available.

Pain Management Clinic: Dedicated to pain management and relief for chronic
pain conditions.

Travel Clinic: Providing travelers with necessary vaccinations, health advice, and
travel-related medical services.

Rehabilitation and Wellness:

Physiotherapy: Rehabilitation services to aid in recovery and improve mobility.

Nutritional Counseling: Dietitians offer dietary guidance and nutrition plans for
various medical conditions.

Stress Management: Programs and counseling to help manage stress and mental
health.

29
Other Services:

Pharmacy: An in-house pharmacy provides prescription medications and

healthcare products.

Patient Counseling: Patients receive counseling and support throughout their

healthcare journey.

Health Check-ups: Routine health check-up packages for preventive care are
available.

Medical Tourism:

Fortis Healthcare Limited on Richmond Road caters to international patients,

offering a range of services to facilitate medical tourism. This includes visa
assistance, airport transfers, language interpreters, and more.

Laboratory Services:

Clinical Biochemistry, Clinical Pathology, Haematology, Clinical Microbiology

and Serology, Histopathology, Cytology, Molecular Biology.

Conclusion:

Fortis Healthcare Limited on Richmond Road is a comprehensive healthcare

facility that covers a wide spectrum of medical specialties, diagnostic services,
surgical procedures, and specialized clinics. Their commitment to delivering high-
quality healthcare services has earned them a reputation as one of India's leading
healthcare providers. This overview provides a glimpse into the extensive range of
products and services offered by Fortis Healthcare Limited at their Richmond Road
location, where patients can access advanced medical care and compassionate
treatment from a dedicated team of healthcare professionals.

30
 2.4 VISSION AND MISSION OF FORTIS HOSPITAL.

Fortis healthcare is a leading healthcare provider in India, and it operates a network

of hospital and healthcare facilities across the country. The vision and mission of
Fortis hospital are instrumental in guiding the organization towards its goals of
providing high quality healthcare services to patients. I can certainly provide you
with a detailed overview of Fortis hospital vision and mission.

VISSION OF FORTIS HOSPITAL:

“Saving and Enriching Lives”:

Saving lives involves actions and interventions that prevent death or preserve life
in critical situations, such as medical treatments, emergency response, or disaster
relief efforts.

Enriching lives goes beyond mere survival, focusing on improving quality of life
through education, healthcare, social support, and economic opportunities. While
saving lives is essential for immediate survival, enriching lives aims to enhance
well-being and potential, fostering personal growth, happiness, and prosperity.
Both are vital aspects of human progress, with saving lives addressing immediate
crises and enriching lives contributing to long-term societal development and
fulfillment. Together, they create a more compassionate and sustainable world.

31
MISSION OF FORTIS HOSPITAL:

“To be globally respected healthcare organization known for Clinical

Excellence and Distinctive Patient Care”.

Clinical Excellence: Fortis Hospital is dedicated to maintaining the highest

standards of clinical excellence. This means continuously improving medical
practices, adopting cutting-edge technologies, and fostering a culture of research
and innovation to ensure that patients receive the best possible care.

Compassionate Patient Care: Fortis Hospital believes in treating every patient

with utmost compassion, dignity, and respect. They are committed to providing a
healing and supportive environment where patients and their families feel
comfortable and cared for throughout their healthcare journey.

Education and Training: Fortis Hospital recognizes the importance of nurturing

talent in the healthcare industry. They invest in education and training programs
for their staff to ensure that they are well-equipped to provide the best care and
stay up-to-date with the latest advancements in medicine.

Ethical Practices: The organization upholds the highest ethical standards in all its
interactions, both within the organization and with patients, partners, and the
community at large. Integrity and transparency are fundamental to their operations.

Innovation: Fortis Hospital is committed to pushing the boundaries of healthcare

through innovation. They actively seek out and implement new technologies,
treatments, and processes to improve patient outcomes and enhance the overall
healthcare experience.

Community Engagement: Fortis Hospital recognizes its responsibility to the

communities it serves. They engage in various community outreach programs,
health camps, and initiatives to promote wellness and healthcare awareness.

32
Sustainability: Fortis Hospital is dedicated to environmental sustainability. They
take measures to reduce their carbon footprint and promote eco-friendly practices
in their healthcare facilities.

Global Collaboration: Fortis Hospital seeks to collaborate with international

healthcare institutions and experts to bring the best global practices and knowledge
to the Indian healthcare landscape.

Continuous Improvement: The organization is committed to a culture of

continuous improvement. They regularly review and assess their processes, patient
feedback, and outcomes to identify areas for enhancement and make necessary
adjustments.

VALUES:

Patient Centricity: Committed to best outcomes and experiences for the patients,
wherein patients and caregivers are treated with compassion, care and
understanding. In all aspects the patients needs are given utmost priority.

Teamwork: Proactive support each other and operate as one team. Respect and
value people at all levels with different opinions, experiences and background. Put
organization needs before department\self interest.

Ownership: Be responsible and take pride in our actions. Take initiative and go
beyond the call of duty deliver commitment and agreement made.

Innovation: Continuously improve and innovate to exceed expectations. Adopt a

‘can do’ attitude. Challenge ourselves to do things differently.

Integrity: Be principled, open and honest. Be a model for others by living our
values. Demonstrate moral courage to speak up and do the right things.

33
RIGHTS AND RESPONSIBILITIES:

PATIENT RIGHTS:
 Right to impartial access to care.
 Right to respect & dignity.
 Right to privacy & confidentiality.
 Right to know the identity & professional status of the care givers.
 Right to information regarding the diagnosis & treatment.
 Right to informed participation in decision involving his/her care.
 Right to refuse treatment.
 Right to consult with other specialist(s) at his/her own expense.
 Right to explanation of the need for transfer elsewhere for continuity of care.
 Right to inform of hospital rules & regulations.

PATIENT RESPONSIBILITIES:

 Providing accurate & complete information about your medical complaints,

past illnesses, hospitalization, medications, pain & other matters relating to
their health.
 Follow the treatment plan recommended by those responsible for your care.
 To accept the consequences in-case of refused of treatment from your care
giver.
 Paying your bills promptly.
 To take care of your personal belongings.
 Keeping your schedules appointment or to cancel them in advance if at all
possible.

Conclusion:

Fortis Hospital's vision is to be a trusted and preferred healthcare provider known

for clinical excellence and compassion. Their mission centers around clinical
excellence, compassionate patient care, accessibility, education, ethics, innovation,
community engagement, sustainability, global collaboration, and continuous
improvement. By adhering to these principles, Fortis Hospital aims to make a
meaningful and lasting impact on the healthcare landscape in India and beyond.
34
 2.5 MCKINSEYS 7-S FRAMEWORK OR BUSINESS
CANVAS MODEL.
Firstly introduced by Tom Peters and Robert Waterman in their best selling book
“In search of excellence “, 7s Framework is strategic tool to better understand and
analyze the complexity of an organization. The Mckinsey 7s model provides a
multidimensional framework to analyze the current state of an organization and
where it can make changes to achieve the desired objectives. In essence Mckinsey
7s framework is a strategic planning tool.

The healthcare sector has witnessed a significant surge in mergers and acquisitions
(M&A) in recent years. These strategic moves are aimed at achieving synergies,
improving operational efficiency, and enhancing the overall quality of patient care.
However, M&A activities in the healthcare sector are not without their challenges
and complexities. This empirical study utilizes McKinsey's 7S framework to assess
the benefits and drawbacks of mergers and acquisitions, focusing on the case of
Fortis Healthcare, a prominent player in the Indian healthcare industry.

The Mckinsey 7s framework model. They are:

Strategy

Structure

System

Skills

Staff

Style

Shared values

35
What are the soft element of Mckinsey 7s model? How these soft
element can be used in analyzing Fortis Healthcare?
The soft element of Mckinsey 7s model are- Staff, Skills, Style, and Shared values.
They are related to the people in the organization. The soft elements are most
difficult to change in the organization. For example if the organization decide to
enter a new industry- it needs to align the staff, skills, style of the present structure
with those that can be effective in the new industry. The critically of the soft
element can be understood by the rate of failure of mergers and acquisition. More
than 80% of the mergers and acquisition fail. The most prominent reason of the
failure is- failure to integrate the culture and shared values of the organization.
Here are the soft elements of Mckinsey 7s framework model are explained below:

Staff: Some of the steps Fortis Healthcare can take in to improve the human
resources are: Recruitment and remote onboarding- because of the pandemic, a lot
of employee are working from remote locations. To make the environment more
inclusive for the new employee, Fortis Healthcare should build system for remote
onboarding such as- catalog of short videos, small groups interaction, technical
demonstrations. Open chats for the people to approach people at various levels in
the hierarchy. It will not only help the top management to directly interact with the
people below but also help in building an open and transparent culture.

Skills: Mergers and acquisition activities require specific skills in negotiation,

change management, and culture integration. Fortis healthcare has had to invest in
training and development programs to equip its workforce with the necessary skills
to adopt to the changing organizational landscape. Fortis Healthcare can build
structured training and development program for people working from remote
locations. Fortis Healthcare can hire fresh talents as more and more people are
leaving their existing jobs because they are not challenging them enough. This has
been both a challenge and an opportunity for employee growth and development.

36
Style / Leadership style & Culture: Leadership style plays an crucial role in
mergers and acquisition success. Fortis healthcare’s leadership has had to adapt to
a more collaborative and integrative approach to manage the diverse workforce and
organization culture resulting from multiple acquisition. Each organization has its
own culture which has evolved over a period of time. The organization style or
culture includes, leadership style within the organization, dominant values and
beliefs, work culture, informal network among employee, management style etc.

Shared values: Are the core beliefs of an organization that are widely shared
across the organization and are reasons for its existences. Shared values include-
the vision, mission, and values statement that provide employees a common
purpose. Shared value are the reason why the organization is doing what it is
doing. Maintaining a shared vision and core value across the organization is
challenging during merger and acquisition. Fortis healthcare has emphasized the
important of patient-centric care and ethical practice throughout its journey,
ensuring that these shared values remain at the heart of its operations.

What are the hard element of Mckinsey 7s model? How these

elements can be used in analyzing Fortis Healthcare?
The hard element of the organization are- Strategy, Structure, and System. These
are the building blocks of the organization around which the organization builds its
soft elements. Structure and System are the easiest to among the 7s to change. Here
are the some of the Hard elements of Mckinsey 7s framework model which are
explained below. They are:

Strategy: Fortis Healthcare's growth strategy has predominantly revolved around

M&A. The company has expanded its footprint by acquiring various healthcare
facilities across India. While this strategy has allowed Fortis to gain a competitive
edge and increase its market share, it also posed challenges in terms of integrating
diverse organizational cultures and aligning strategic objectives. It needs to build a
balance between short run cost savings and protecting its core competitive
advantages.
37
Structure: Fortis' structure has evolved with its numerous acquisitions. This has
resulted in a complex organizational structure with multiple hospitals and
healthcare facilities operating under the Fortis brand. The challenge here lies in
achieving seamless coordination and communication across the organization to
ensure efficient operations. The pandemic has questioned the current structure and
supply chain management of the company. To be more resilient organization and
prepare itself for future disruption of similar magnitudes Fortis healthcare should
focus on- diversifying supplier geographically so that climate related, geopolitical,
and other disruptions don’t impact long term survival of the company.

System: Fortis healthcare needs to focus on the following areas- Improve internal
process, such as risk management, Customer relationship management (CRM),
web app optimization, and data visualization across the organization. The
healthcare sector is heavily reliant on information systems for patient management,
clinical operations, and administrative functions. Mergers and acquisitions often
lead to the integration of disparate systems, which can create compatibility issues
and affect the overall efficiency of healthcare delivery. What are the technological
system put in place to smoothen the operation, what are the formal and informal
procedure put in place to manage the organization, planning, budgeting,
performance measurement, resources allocation, and management information
system (MIS).

Conclusion:

Fortis Healthcare's journey in the healthcare sector, characterized by multiple

mergers and acquisitions, showcases the benefits and drawbacks of such strategic
moves. McKinsey's 7S framework provides a comprehensive lens through which to
assess the impact of M&A activities on an organization.

While Fortis Healthcare achieved geographic expansion, enhanced service

offerings, and economies of scale through M&A, it also faced integration
challenges, regulatory hurdles, financial risks, and employee discontent.

38
 BUSINESS CANVAS MODEL

Designed for: Designed by: Date: Version:

Business Model Canvas Formate Fortis Healthcare 3-10-2012 2.0

Key Partners Key Activities Value Propositions Customer Relationships Customer Segments
 Medical Services.  Comprehensive  Personalized Care.  Patients.
 Pharmaceutical  Research & Healthcare.  Digital Engagement.  Health Insurance
Companies. Development.  Quality and Trust.  Feedback Loop. Company.
 Insurance Providers.  Acquisition &  Efficiency and Cost  Government Health
 Government Health Intergration. Saving. Programs.
Agencies.

Future Growth Strategies Key Resources Unique Selling Proposition Channels Risk & Mitigation
 Geographic  Medical Staff.  “Your Health, Our  Hospital Facilities.  Regulatory
Expansion.  Medical Equipment. Priority”.  Online Platforms. Compliance.
 Telehealth Services.  Facilities.  Referral Network.  Integration
 Specialized Centre Challenges.
 Economic & Market
Risk.

Cost Structure Revenue Streams

 Staffing.  Healthcare Services.
 Facility Maintenance.  Health Insurance Reimbursements.
 Technology & Research.  Medical Tourism.

Designed by: The Business Model Foundry (www.businessmodelgeneration.com/canvas). Word implementation by: Neos Chronos Limited (https://neoschronos.com). License: CC BY-SA 3.0

Creating a business canvas model for a merger and acquisition (M&A) in the
healthcare sector, specifically involving Fortis Healthcare Ltd, requires a
comprehensive analysis of various aspects of the business. This canvas will
provide an overview of the key elements involved in the M&A process, including
the value proposition, customer segments, revenue streams, and more.

1. Customer Segments:

Patients: Fortis Healthcare serves a diverse range of patients, including those

seeking routine healthcare services, specialized treatments, and medical tourism.

Health Insurance Companies: Insurance companies are important customers, as

they cover a significant portion of patients' healthcare expenses.
39
Government Health Programs: Collaboration with government healthcare
initiatives can be a lucrative customer segment.

2. Value Proposition:

Comprehensive Healthcare: Fortis Healthcare offers a wide range of medical

services, including diagnostics, treatments, surgeries, and post-operative care.

Quality and Trust: A strong reputation for quality healthcare services and trust is a
valuable proposition.

Efficiency and Cost Savings: M&A can lead to operational efficiency and cost
savings, which can be passed on to customers.

3. Channels:

Hospital Facilities: Utilize the existing Fortis hospitals as key delivery channels.

Online Platforms: Expand the online presence to facilitate appointments,

consultations, and patient education.

Referral Network: Develop a network of referring physicians and healthcare

professionals.

4. Customer Relationships:

Personalized Care: Ensure personalized care through healthcare professionals and

patient-centric services.

Digital Engagement: Implement telemedicine and digital tools for ongoing patient
engagement.

Feedback Loop: Establish mechanisms for collecting and acting on patient

feedback.

5. Revenue Streams:

Healthcare Services: Revenue primarily comes from providing medical services,

including consultations, surgeries, diagnostics, and more.
40
Health Insurance Reimbursements: Revenues from insurance companies for
services rendered.

Medical Tourism: Attract international patients seeking high-quality healthcare

services.

6. Key Resources:

Medical Staff: Highly skilled doctors, nurses, and support staff.

Medical Equipment: State-of-the-art diagnostic and treatment equipment.

Facilities: Hospitals, clinics, and medical centers.

7. Key Activities:

Medical Services: Provide a full spectrum of healthcare services.

Research and Development: Invest in medical research and development to stay at

the forefront of medical technology.

Acquisitions and Integrations: Integrate new facilities and businesses smoothly into
the Fortis network.

8. Key Partnerships:

Pharmaceutical Companies: Collaborate with pharmaceutical companies for

medication supply.

Insurance Providers: Forge strong partnerships with insurance providers.

Government Health Agencies: Partner with government health programs to reach a

wider patient base.

9. Cost Structure:

Staffing: Costs associated with hiring and retaining medical staff.

Facility Maintenance: Maintenance and operational costs for healthcare facilities.

41
Technology and Research: Investment in technology and medical research.

10. Risk and Mitigation:

Regulatory Compliance: Ensure compliance with healthcare regulations in all
regions of operation.

Integration Challenges: Carefully plan and execute the integration of new facilities
to minimize disruptions.

Economic and Market Risks: Monitor economic conditions and adapt strategies
accordingly.

11. Unique Selling Proposition (USP):

"Your Health, Our Priority": Emphasize Fortis Healthcare's commitment to

patient well-being and the comprehensive range of medical services offered.

12. Future Growth Strategies:

Geographic Expansion: Consider expanding operations to new regions or

countries.

Telehealth Services: Invest in telemedicine to reach a broader patient base.

Specialized Centers: Establish specialized medical centers of excellence.

Conclusion:
A merger and acquisition involving Fortis Healthcare Ltd in the health sector
would focus on leveraging its existing strengths, including a strong brand, a
comprehensive range of healthcare services, and a reputation for quality and trust.
The canvas outlines how Fortis Healthcare can expand its customer segments,
revenue streams, and partnerships while managing costs and risks to ensure long-
term success and growth in the healthcare sector.

42
 CHAPTER-3
REVIEW OF LITERATURE AND RESEARCH DESIGN.
Introduction:

Mergers and acquisitions (M&A) have become a prominent strategy in the

healthcare sector, with organizations like Fortis actively participating in this
dynamic landscape. This review of literature explores existing research on M&A in
the health sector, with a focus on Fortis, and proposes a research design to further
investigate this critical topic.

Review of Literature:

M&A Trends in Healthcare: Over the past few decades, the healthcare sector has
witnessed a significant surge in M&A activities. The primary drivers include cost
reduction, enhanced market share, and access to new technologies. Fortis, a leading
player in the healthcare industry, has been actively involved in M&A deals to
expand its operations and increase its competitive advantage.

Financial Outcomes: Numerous studies have explored the financial outcomes of

M&A in the healthcare sector. Some research suggests that M&A can result in cost
synergies and increased profitability, while others argue that it may lead to
financial distress if not managed effectively. Analyzing Fortis' M&A deals and
their financial impact would be crucial in understanding their strategy.

Operational Challenges: M&A in healthcare often involves integrating complex

systems, cultures, and processes. Research has highlighted operational challenges
such as post-merger integration, human resource management, and aligning the
organizational culture. Investigating how Fortis has addressed these challenges
could provide valuable insights.

43
Patient Outcomes and Quality of Care: The impact of M&A on patient
outcomes and the quality of care is a critical aspect. Studies have shown mixed
results, with some suggesting that M&A can improve patient care through resource
sharing and increased efficiency, while others argue that it may lead to a decline in
quality due to disruption in services.

Regulatory and Ethical Considerations: M&A in healthcare is subject to

stringent regulatory oversight and ethical scrutiny. Compliance with regulations
and ethical standards is paramount. Fortis' adherence to these factors and its
implications for M&A success can be an interesting research focus.

Research Design:
To investigate M&A activities in the health sector with a specific focus on Fortis, a
comprehensive research design is proposed:

Objective: The primary objective of this research is to assess the impact of M&A
activities on Fortis in terms of financial performance, operational efficiency,
patient outcomes, and compliance with regulatory and ethical standards.

Data Collection: Gather financial data of Fortis pre- and post-M&A deals to
assess their impact on profitability and efficiency. Conduct interviews with key
stakeholders, including Fortis executives, to understand their strategic goals and
challenges in M&A. Collect patient outcome data and survey patients to gauge
their satisfaction and perception of care quality.

Data Analysis:

Employ financial analysis techniques (e.g., financial ratios, regression analysis) to

evaluate the financial impact of M&A.

44
Use qualitative analysis to identify operational challenges and strategies employed
by Fortis. Quantitatively assess patient outcomes and satisfaction using statistical
analysis.

Ethical and Regulatory Compliance Evaluation:

Review Fortis' compliance with healthcare regulations and ethical standards.

Compare Fortis' performance in this regard with industry benchmarks.

Sample:

Include multiple M&A cases involving Fortis over the past decade. Involve a
diverse range of stakeholders including Fortis executives, employees, and patients.

Expected Outcomes:

Insights into the financial performance of Fortis post-M&A. Identification of

operational challenges faced by Fortis and strategies employed for integration.
Evaluation of patient outcomes and satisfaction. Assessment of Fortis' compliance
with healthcare regulations and ethical standards.

Conclusion:
Mergers and acquisitions in the healthcare sector, especially in the case of a
prominent player like Fortis, have significant implications for various stakeholders.
This review of literature highlights the key areas of research interest, including
financial outcomes, operational challenges, patient outcomes, and compliance with
ethical and regulatory standards. The proposed research design aims to provide a
comprehensive analysis of M&A activities in the health sector, with Fortis as a
focal point, ultimately contributing to a better understanding of the impact of M&A
on healthcare organizations.

45
 3.1 REVIEW OF LITERATURE AND GAPS.
Introduction:
The healthcare sector has witnessed significant transformation over the years,
driven by factors such as technological advancements, changing patient
demographics, and the need for cost-effective care delivery. In response to these
challenges and opportunities, mergers and acquisitions (M&A) have emerged as a
strategic tool for healthcare organizations to achieve growth, enhance
competitiveness, and improve operational efficiency. Fortis Healthcare, a leading
player in the Indian healthcare industry, has been actively involved in M&A
activities. This literature review aims to examine the gaps, downfalls, and benefits
of M&A in the healthcare sector, with a specific focus on Fortis.

Gaps in Literature:

Lack of Comprehensive Frameworks: One significant gap in the literature is the

absence of comprehensive frameworks that guide healthcare organizations through
the M&A process. Existing studies often focus on specific aspects, such as
financial performance or post-merger integration, but fail to provide a holistic
view. Organizations like Fortis could benefit from a more comprehensive roadmap
for successful M&A execution.

Limited Case Studies: While there is a growing body of literature on healthcare

M&A, there is a scarcity of in-depth case studies, particularly concerning Fortis
Healthcare. Case studies offer valuable insights into the challenges faced and
strategies employed by healthcare organizations during M&A transactions. A more
extensive collection of such cases would enhance our understanding of the unique
dynamics of the healthcare sector.

Stakeholder Perspectives: Understanding the viewpoints of various stakeholders

involved in healthcare M&A, including patients, employees, and regulatory bodies,
is essential. However, literature often overlooks these perspectives. Fortis and
other healthcare organizations need insights into managing stakeholder concerns
and expectations during M&A.
46
Downfalls of Mergers and Acquisitions in Healthcare:

Regulatory Challenges: Healthcare is a heavily regulated industry, and M&A

transactions often involve navigating complex regulatory frameworks. Fortis faced
regulatory hurdles during its M&A activities, including approval processes and
compliance issues. These challenges can delay transactions and increase costs.

Integration Difficulties: Successful integration of acquired entities is crucial for

realizing the benefits of M&A. Healthcare organizations, including Fortis, have
struggled with integrating different cultures, systems, and processes. Poor
integration can lead to operational disruptions and decreased patient satisfaction.

Financial Strain: M&A transactions in the healthcare sector often require

substantial financial resources. Fortis experienced financial strain during its
acquisitions, which can result from debt incurred to fund the transactions. This
strain can impact the organization's ability to invest in patient care and
infrastructure.

Benefits of Mergers and Acquisitions in Healthcare:

Economies of Scale: M&A can lead to economies of scale, allowing healthcare

organizations like Fortis to reduce costs through bulk purchasing, shared resources,
and streamlined operations. These savings can be reinvested in improving patient
care and expanding services.

Enhanced Service Offering: By acquiring complementary healthcare providers or

facilities, organizations like Fortis can expand their service offerings and reach a
broader patient base. This diversification can lead to increased revenue and market
share.

Improved Access to Capital: M&A can provide healthcare organizations with

improved access to capital, enabling them to invest in advanced medical
technologies, infrastructure upgrades, and research and development. Fortis has
leveraged M&A to secure funding for modernization and expansion.

47
Conclusion:

Mergers and acquisitions play a significant role in the healthcare sector's growth
and evolution. Fortis Healthcare's experience in M&A transactions highlights the
importance of addressing regulatory challenges, effectively managing integration,
and carefully considering financial implications. While the literature on healthcare
M&A has grown, there remain gaps in comprehensive frameworks and stakeholder
perspectives that need to be addressed.

Moving forward, healthcare organizations, including Fortis, should prioritize due

diligence, strategic planning, and stakeholder engagement when embarking on
M&A endeavors. Future research should aim to bridge the gaps in the literature,
providing valuable guidance to healthcare leaders as they navigate the complexities
of M&A in this vital sector. Ultimately, successful M&A in healthcare can lead to
improved patient care, increased efficiency, and enhanced competitiveness for
organizations like Fortis.

Mergers and acquisitions (M&A) have been a prominent strategy in the healthcare
sector, and Fortis Healthcare, a leading player in this field, has experienced its
share of M&A activities. This literature review aims to explore the gaps,
downfalls, and benefits associated with M&A in the healthcare sector, with a focus
on the case of Fortis. The study highlights the need for careful consideration of the
complexities in healthcare M&A, the challenges faced by Fortis, and the potential
advantages for organizations and stakeholders. Through an analysis of existing
literature, this review sheds light on the critical aspects of M&A in the healthcare
sector.

48
 3.2 STATEMENT OF THE PROBLEM.
Mergers and acquisitions (M&A) are complex corporate strategies that involve one
company combining with another through various means, such as purchasing
assets or shares. While M&A can offer numerous benefits, including increased
market share, cost synergies, and improved competitiveness, they also come with a
host of challenges and problems. In this extensive discussion, we will delve into
the problems associated with mergers and acquisitions, exploring their impact on
businesses, employees, shareholders, and the broader economy.

I. Strategic and Operational Challenges:

Cultural Differences: One of the most significant challenges in M&A is integrating
two organizations with distinct cultures. Differences in corporate culture can lead
to clashes in management styles, employee morale, and communication
breakdowns.

Synergy Realization: The primary goal of many mergers is to achieve synergies,

such as cost savings or revenue enhancements. However, realizing these synergies
can be more challenging than anticipated, leading to financial underperformance.

Integration Process: The process of integrating two companies can be disruptive

and time-consuming. Mismanagement of integration can result in operational
disruptions, loss of key talent, and customer dissatisfaction.

II. Financial Challenges:

Valuation Errors: Incorrect valuation of the target company can result in

overpayment, causing financial strain for the acquiring company and diminishing
the potential benefits of the merger.

Financing Risks: Acquiring companies often take on significant debt to finance

mergers. High debt levels can lead to financial instability, especially if revenue
projections are not met.
49
Earnings Dilution: Mergers can dilute earnings if the target company is not as
profitable as expected. This can lead to decreased shareholder value and
dissatisfaction.

III. Human Capital Challenges:

Employee Resistance: Employees may resist M&A due to job insecurity, changes
in roles, and cultural clashes. This resistance can lead to decreased productivity
and talent flight.

Communication Breakdown: Poor communication during the M&A process can

lead to confusion and anxiety among employees, further impacting morale and
productivity.

Employee Integration: Integrating employees from different companies can be

challenging, as it requires aligning roles, compensation, and performance
expectations.

IV. Legal and Regulatory Challenges:

Antitrust Concerns: Regulators may scrutinize mergers for potential antitrust

violations, especially when the resulting company would have significant market
power. This can lead to delays and restrictions on the merger.

Contractual Obligations: Mergers may trigger contractual obligations, such as

change-of-control provisions, which can result in financial penalties or legal
disputes.

Compliance and Reporting: Merging companies must navigate complex legal and
reporting requirements, which can be time-consuming and resource-intensive.

V. Stakeholder Challenges:

Shareholder Dissatisfaction: Shareholders of the acquiring company may express

dissatisfaction with the deal's terms or potential risks, leading to shareholder
activism or legal action.

50
Customer and Supplier Concerns: Customers and suppliers may be wary of
changes in the merged company, potentially leading to lost business relationships.

Brand and Reputation: Mergers can impact brand image and reputation, especially
if they are not well-received by the public or customers.

VI. Integration and Technology Challenges:

IT Integration: Merging the information technology systems of two companies can
be highly complex and costly. Integration issues can disrupt operations and impact
customer service.

Data Security: The sharing of sensitive data during the merger process can raise
concerns about data security breaches, potentially damaging the companies'
reputations.

Technology Obsolescence: Rapid technological advancements can make recently

acquired technology or assets obsolete, reducing the value of the deal.

VII. Market and Economic Challenges:

Economic Downturn: M&A activity can be adversely affected by economic

downturns, as uncertainty and reduced access to financing can hinder deal
execution.

Market Timing: Poor timing of a merger relative to market conditions can result in
a decrease in the combined company's market value.

Integration Risk Premium: Investors often demand higher returns to compensate

for the risks associated with M&A, making it more expensive for companies to
pursue mergers.

VIII. Post-Merger Performance Challenges:

Post-Merger Integration Delay: Delays in the integration process can prolong the
period during which the company operates with higher costs and lower
efficiencies.

51
Management Distraction: M&A can divert management's attention from day-to-
day operations, potentially harming business performance.

Failed Expectations: When mergers fail to deliver the anticipated benefits, it can
result in disappointed investors and stakeholders, as well as a decline in stock
prices.

IX. Ethical and Social Challenges:

Job Losses: M&A often lead to layoffs and job losses, which can have a negative
social impact, especially in regions where the company is a major employer.

Community Impact: Mergers can disrupt local communities that rely on the
merged companies for employment and economic stability.

Ethical Concerns: Ethical issues, such as conflicts of interest, insider trading, and
questionable deal practices, can arise during M&A transactions, leading to
reputational damage and legal consequences.

Conclusion:

Mergers and acquisitions offer the potential for growth, increased market share,
and operational efficiencies, but they are fraught with numerous challenges and
problems. These challenges span from strategic and operational issues to financial,
human capital, legal, stakeholder, technology, market, post-merger performance,
ethical, and international complexities. Recognizing and effectively addressing
these challenges is crucial for companies seeking to execute successful mergers
and acquisitions, as failure to do so can result in financial losses, damaged
reputations, and negative impacts on employees and communities. Consequently,
thorough due diligence, careful planning, and adept execution are essential for
mitigating these problems and maximizing the potential benefits of M&A
transactions.

52
 3.3 NEEDS OF THE STUDY.
Mergers and acquisitions (M&A) are complex corporate transactions that involve
the consolidation or combination of two or more companies. These transactions
can take various forms, including mergers, acquisitions, joint ventures, and
divestitures. M&A activities can be driven by various factors and can serve
different strategic needs for the participating companies. In this comprehensive
discussion, we will delve into the key needs and motivations behind M&A
transactions, providing insights into why companies engage in such activities.

Strategic Growth: One of the primary needs for M&A is strategic growth.
Companies often seek to expand their operations, market share, or geographic
reach. Merging with or acquiring another company can provide immediate access
to new markets, customers, and distribution channels. This can be especially
beneficial in industries where organic growth is slow or saturated.

Synergy Realization: Companies often pursue M&A to achieve synergies.

Synergies can take various forms, including cost synergies and revenue synergies.
Cost synergies result from combining operations, streamlining processes, and
eliminating redundancies, which can lead to cost savings. Revenue synergies arise
from cross-selling opportunities, expanded product offerings, or increased pricing
power.

Diversification: Companies may engage in M&A to diversify their product or

service offerings. Diversification can reduce reliance on a single market or product,
making the company more resilient to economic downturns or changes in
consumer preferences. For example, a software company might acquire a hardware
manufacturer to diversify its technology portfolio.

Access to Intellectual Property and Technology: In today's technology-driven

world, access to intellectual property and cutting-edge technology can be a
significant motivator for M&A. Acquiring a company with valuable patents,
proprietary technology, or R&D capabilities can give a company a competitive
edge and accelerate innovation.

53
Market Entry: Companies looking to enter a new market may find it more
expedient to do so through M&A rather than organic expansion. Acquiring an
established player in the target market provides immediate market presence, local
knowledge, and an existing customer base.

Competitive Advantage: M&A can be a means to gain a competitive advantage.

By acquiring a competitor or a complementary business, a company can solidify its
position in the market, expand its customer base, and achieve a stronger market
share. This can lead to increased bargaining power and improved profitability.

Economies of Scale: M&A can lead to economies of scale, which can reduce per-
unit costs and improve overall efficiency. Combining production, distribution, and
administrative functions can often result in cost savings due to increased
purchasing power and the elimination of duplicate processes.

Access to Capital and Resources: Smaller companies may seek M&A deals with
larger, financially stable organizations to access capital and resources that would
be otherwise unavailable. This can facilitate growth, research and development,
and the pursuit of new business opportunities.

Risk Mitigation: M&A can serve as a risk mitigation strategy. By diversifying

across different markets or product lines, a company can reduce its exposure to
market-specific risks. Additionally, in industries with high regulatory or legal risks,
M&A can provide a buffer through increased size and resources.

Talent Acquisition: Acquiring companies often means gaining access to their

talent pool. Skilled employees, particularly in specialized fields, can be difficult to
find and retain. M&A can be a means to acquire top talent, which is crucial for
innovation and growth.

Tax Benefits: There can be tax advantages associated with M&A transactions.
These may include opportunities to offset losses, utilize tax credits, or restructure
the combined entity's tax liabilities in a more favorable manner.

54
Enhancing Shareholder Value: M&A activities are often driven by the desire to
enhance shareholder value. This can be achieved through increased revenue,
improved profitability, stock price appreciation, or dividend payments resulting
from the synergies and efficiencies generated by the merger or acquisition.

Globalization: As businesses expand globally, M&A can facilitate international

growth. Companies may acquire foreign entities to gain a foothold in international
markets, leverage local expertise, and navigate regulatory complexities.

Strategic Realignment: Sometimes, companies need to realign their strategic

focus due to changes in the business environment. M&A can help in shedding non-
core assets and businesses that no longer fit the company's long-term strategy.

Vertical Integration: Companies may seek to vertically integrate by acquiring

suppliers or distributors. Vertical integration can provide more control over the
supply chain, reduce dependency on external parties, and capture a greater share of
the value chain.

Exit Strategy: For owners and investors looking to exit a business, M&A can be
an attractive exit strategy. Selling to a strategic buyer or private equity firm can
provide liquidity and potentially realize significant returns on investment.

Conclusion:

Mergers and Acquisitions are multifaceted transactions that fulfill a wide range of
strategic needs for companies. These needs can include growth, synergy
realization, diversification, access to technology and talent, risk mitigation, tax
benefits, and more. Successful M&A transactions require careful planning, due
diligence, and integration efforts to ensure that the expected benefits are realized.
Additionally, external factors such as economic conditions, regulatory changes,
and market dynamics can influence the decision-making process behind M&A
activities. As businesses evolve and the global economic landscape continues to
change, M&A will remain a critical tool for companies to adapt, grow, and thrive
in an ever-competitive environment.
55
 3.4 SCOPE OF THE STUDY.

Mergers and acquisitions (M&A) are complex financial transactions involving the
combination of two or more companies. The scope of M&A is vast and
multifaceted, encompassing a wide range of strategic objectives and potential
outcomes. In this discussion, we will explore the scope of mergers and
acquisitions, touching on various aspects and considerations, and their significance
in the business world.

1. Strategic Objectives:

Growth: Companies often pursue M&A to achieve rapid growth, whether in terms
of market share, revenue, or geographic expansion. Acquiring another company
allows for the consolidation of resources and customer bases, facilitating growth.

Diversification: M&A can help companies diversify their product or service

offerings, reducing dependence on a single revenue stream. For example, a tech
company might acquire a healthcare company to enter a new industry.

Cost Synergies: Combining operations can lead to cost savings through economies
of scale. By eliminating duplicate functions and streamlining processes, companies
can reduce overhead and improve profitability.

56
2. Types of M&A Transactions:

Acquisitions: In this scenario, one company, often referred to as the acquirer or

buyer, purchases another company, known as the target. This can be a friendly or
hostile takeover.

Mergers: Mergers involve the combination of two or more companies to form a

new entity. This can be a merger of equals, where both companies contribute
equally, or a merger where one company is dominant.

Divestitures: Companies may sell or spin off certain assets or subsidiaries to raise
capital, refocus on core operations, or comply with regulatory requirements.

Joint Ventures: Two or more companies can form a joint venture to collaborate on
a specific project or business activity without fully merging their operations.

3. The Deal Process:

Strategic Planning: Companies identify their M&A goals, such as growth or
diversification, and develop a strategy to achieve them.

Target Identification: Companies search for potential targets that align with their
strategic objectives. This involves financial analysis, due diligence, and
negotiations.

Valuation: Determining the value of the target company is a critical step in the
M&A process. Valuation methods can include financial modeling, market analysis,
and industry benchmarks.

Negotiation: Negotiations between the buyer and seller are essential to agree on
deal terms, including price, payment structure, and any conditions.

4. Economic and Financial Considerations:

Economic Impact: M&A activity can stimulate economic growth by promoting

investment, job creation, and innovation. However, it can also lead to market
concentration and reduce competition in some cases.

57
Financial Impact: For companies, M&A transactions can impact their financial
statements, including the balance sheet, income statement, and cash flow. The
success of a deal is often measured by its impact on financial performance and
shareholder value.

Shareholder Value: Shareholders of both the acquiring and target companies can
experience changes in the value of their investments due to M&A. Successful
transactions should ideally create value for shareholders over the long term.

5. Legal and Regulatory Framework:

Antitrust and Competition Laws: Regulatory authorities review M&A transactions

to ensure they do not result in anti-competitive behavior or monopolistic control of
markets.

Securities Regulations: Publicly traded companies must comply with securities

regulations and disclose material information about M&A transactions to
shareholders and the public.

Tax Implications: M&A transactions can have significant tax implications for both
the buyer and seller, including capital gains tax, transfer pricing, and tax-efficient
deal structures.

6. Cultural and Human Resources Integration:

Mergers and acquisitions often involve bringing together employees from different
corporate cultures. Managing cultural integration and human resources challenges
is critical for a successful outcome:

Employee Morale: M&A transactions can create uncertainty and anxiety among
employees. Effective communication and retention strategies are essential to
maintain employee morale and productivity.

Talent Retention: Identifying and retaining key talent from both companies is
crucial to preserving institutional knowledge and ensuring a smooth transition.

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7. Industry-specific Considerations:

Technology and Innovation: In the tech industry, M&A is often driven by the need
to acquire new technologies, talent, and intellectual property. Companies
frequently acquire startups to stay competitive and innovative.

Healthcare: Healthcare M&A is driven by factors such as the need for scale, access
to patient populations, and regulatory changes. It includes hospital mergers,
pharmaceutical acquisitions, and partnerships between healthcare providers.

Financial Services: In the financial sector, M&A can involve banks merging to
gain market share, asset managers acquiring complementary businesses, or fintech
companies expanding their service offerings.

8. International M&A:

M&A transactions can be domestic or international in scope. International M&A

presents unique challenges related to cultural differences, regulatory environments,
and currency exchange rates. Companies engaging in cross-border M&A must
navigate these complexities and often conduct extensive due diligence.

9. Failed M&A Transactions:

Poor Due Diligence: Inadequate assessment of the target company's financial

health, legal issues, or market conditions can lead to unexpected problems post-
acquisition.

Overpayment: Paying too much for the target company can result in financial
strain and make it challenging to achieve a positive return on investment.

Regulatory Issues: Failing to obtain regulatory approvals or encountering

unforeseen regulatory obstacles can lead to deal failure.

10. Post-Merger Integration:

Cultural Integration: Harmonizing corporate cultures, values, and communication

is crucial to building a cohesive and productive workforce.

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Operational Integration: Streamlining processes, combining systems, and
eliminating redundancies can lead to cost savings and improved efficiency.

Talent Retention: Identifying and retaining top talent from both companies is
critical for a smooth transition and long-term success.

11. Ethical and Social Considerations:

Job Losses: M&A can lead to layoffs and job losses, which can have negative
social and economic consequences, particularly in local communities.

Corporate Responsibility: Companies must consider their social responsibility and

ethical obligations when conducting M&A. This includes issues related to
environmental impact, corporate governance, and ethical business practices.

Stakeholder Interests: Balancing the interests of various stakeholders, including

employees, shareholders, and the community, is a complex ethical challenge in
M&A.

12. The Role of Advisors and Intermediaries:

Many parties are involved in M&A transactions, including investment bankers,

lawyers, accountants, and consultants. These professionals play crucial roles in
facilitating deals, conducting due diligence, and ensuring legal and financial
compliance.

Conclusion:

The scope of mergers and acquisitions is vast and multifaceted, encompassing a

wide range of strategic objectives, economic considerations, legal and regulatory
requirements, and ethical and social implications. M&A transactions have the
potential to drive growth, create value, and reshape industries, but they also come
with risks and challenges that require careful planning and execution. Successful
M&A transactions hinge on strategic vision, thorough due diligence, effective
integration, and a deep understanding of the complexities involved in combining
two or more companies.
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 3.5 OBJECTIVES OF THE STUDY.
Mergers and acquisitions (M&A) in the healthcare sector are complex transactions
that involve the consolidation of healthcare organizations or the purchase of one
healthcare entity by another. These transactions can take various forms, including
mergers, acquisitions, joint ventures, and strategic partnerships. The objectives of
M&A in the healthcare sector are multifaceted and can vary depending on the
specific circumstances and goals of the organizations involved. In this essay, we
will explore the key objectives of M&A in the healthcare sector, highlighting their
significance and potential benefits.

Enhancing Service Delivery and Quality of Care:

One of the primary objectives of M&A in the healthcare sector is to improve the
quality of healthcare services provided to patients. Combining resources, expertise,
and infrastructure can lead to more comprehensive and efficient patient care. By
merging or acquiring healthcare facilities, organizations can share best practices,
standardize care protocols, and invest in advanced medical technologies. This
ultimately benefits patients by offering them a higher quality of care.

Economies of Scale and Cost Reduction:

Achieving economies of scale is a crucial objective in healthcare M&A. Larger
healthcare organizations can negotiate better prices with suppliers, streamline
administrative functions, and optimize resource utilization. This can result in cost
savings, which can be reinvested in improving patient care, expanding services, or
reducing the financial burden on patients.

Geographic Expansion:

M&A allows healthcare organizations to expand their geographic footprint and

reach a broader patient population. This is particularly important in areas with
underserved or remote communities where access to healthcare services is limited.
By expanding their reach, healthcare providers can ensure that more people have
access to timely and quality care.

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Diversification of Services:

Healthcare organizations may pursue M&A to diversify their range of services. For
example, a hospital may acquire a specialty clinic to offer a broader spectrum of
care. This diversification can help organizations better meet the diverse healthcare
needs of their communities and reduce dependency on a single service line.

Research and Innovation:

Collaborative M&A activities in the healthcare sector can promote research and
innovation. By pooling resources and expertise, organizations can invest in
research and development efforts, which can lead to the discovery of new
treatments, therapies, and medical technologies. This fosters progress in the field
of healthcare and benefits patients by offering cutting-edge treatments.

Enhancing Financial Stability:

Financial stability is a critical objective for healthcare organizations. M&A can

help struggling healthcare facilities overcome financial challenges by merging with
financially stronger partners. This stability is essential to ensure the long-term
sustainability of healthcare services, especially in areas facing economic
challenges.

Improving Access to Capital:

Access to capital is often a limiting factor for healthcare organizations looking to
invest in infrastructure, technology, and facility upgrades. M&A can provide
access to additional capital through the involvement of private equity firms or by
leveraging the financial strength of the acquiring organization. This infusion of
capital can drive improvements in healthcare infrastructure and services.

Streamlining Operations and Management:

Another objective of M&A in the healthcare sector is to streamline operations and

management. Combining administrative functions, such as human resources,
finance, and supply chain management, can reduce redundancy and improve
efficiency.
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Enhancing Negotiating Power:

In the rapidly evolving healthcare landscape, having strong negotiating power is

essential. M&A can give healthcare organizations more leverage when negotiating
contracts with insurance providers, pharmaceutical companies, and other
stakeholders. This can result in better reimbursement rates and more favorable
terms, ultimately benefiting patients and the organization's financial health.

Risk Mitigation:

Healthcare organizations often face various risks, including regulatory changes,

legal challenges, and economic downturns. M&A can serve as a risk mitigation
strategy by diversifying the organization's portfolio, spreading risk across a larger
entity, and providing access to legal and compliance expertise.

Competitive Advantage:

Healthcare is a highly competitive industry, and M&A can provide a competitive

advantage. By combining strengths and resources, organizations can position
themselves as leaders in their markets, attracting patients, healthcare professionals,
and strategic partners.

Community Health Improvement:

M&A can be driven by a commitment to improving community health. Healthcare

organizations may merge or acquire facilities in underserved areas to ensure that
vulnerable populations receive necessary care. This social responsibility objective
aligns with the broader goal of advancing public health.

Technology Integration:

Healthcare M&A can facilitate the integration of healthcare information

technology (IT) systems. A unified IT infrastructure can enhance data sharing,
interoperability, and telemedicine capabilities, improving patient care coordination
and accessibility.

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Long-Term Sustainability:

The healthcare sector is subject to long-term demographic and epidemiological

changes. M&A can be driven by a desire to adapt to these changes and ensure the
long-term sustainability of healthcare services, particularly in aging populations.

Participation in Healthcare Ecosystems:

Healthcare ecosystems are becoming increasingly interconnected. M&A can
facilitate participation in these ecosystems, allowing organizations to collaborate
with other stakeholders, such as insurers, pharmaceutical companies, and
technology providers, to deliver more comprehensive and coordinated care.

Meeting Strategic Goals:

Finally, M&A activities are often aligned with an organization's broader strategic
goals. These goals may include becoming a regional healthcare leader, achieving
specific patient outcome targets, or diversifying revenue streams.

Conclusion:

Mergers and acquisitions in the healthcare sector serve a multitude of objectives,

all with the overarching goal of improving patient care, financial stability, and the
long-term sustainability of healthcare organizations. These objectives can be
tailored to the unique circumstances and priorities of the organizations involved.
While M&A can offer significant benefits, it is essential for healthcare
organizations to conduct thorough due diligence, consider potential challenges, and
prioritize the best interests of patients and communities throughout the process.
When executed strategically and responsibly, M&A can be a powerful tool for
advancing the quality and accessibility of healthcare services.

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 3.6 HYPOTHESES.
Mergers and Acquisitions (M&A) in the healthcare sector have been a prominent
trend in recent years, driven by various factors such as the pursuit of cost
efficiencies, access to new markets, diversification of services, and the need to
adapt to rapidly changing healthcare landscapes. These M&A activities have given
rise to several hypotheses and theories that attempt to explain the motivations and
potential outcomes of such transactions. In this essay, we will explore key
hypotheses related to M&A in the healthcare sector, providing a comprehensive
understanding of the subject.

Introduction:

Mergers and Acquisitions (M&A) refer to the consolidation of two or more

companies through various financial transactions, including mergers (the
combination of two equal entities) and acquisitions (the purchase of one company
by another). In the healthcare sector, M&A activities have been occurring at an
increasing rate, and they have significant implications for patients, providers,
payers, and the broader healthcare ecosystem. Understanding the hypotheses
behind these transactions is crucial for stakeholders to make informed decisions
and anticipate the consequences of such mergers and acquisitions.

The steps of Hypotheses are given below. They are:

Step-1 Synergy Hypothesis: One of the most common hypotheses behind mergers
and acquisitions is the belief in synergy. Companies often assume that the
combined entity will generate greater value, efficiencies, and profitability than the
individual companies operating independently. Synergy can be categorized into
three main types:

Operational Synergy: This involves cost-saving opportunities, such as economies

of scale, where combined operations can reduce duplicate functions and lower
production costs.

Financial Synergy: Financial benefits can result from improved access to capital,
lower cost of capital, or tax advantages through the M&A.
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Strategic Synergy: Combining companies can create strategic advantages, such as
expanding market presence, diversifying product lines, or entering new geographic
markets.

Step-2 Market Power Hypothesis: Companies often pursue M&A to enhance

their market power. This hypothesis posits that through consolidation, firms can
gain increased market share, pricing power, and the ability to influence industry
dynamics. Market power can lead to higher profit margins and competitive
advantages.

Step-3 Diversification Hypothesis: Diversification is another key hypothesis

behind M&A. Companies may believe that by expanding into different product
lines, industries, or markets, they can reduce risk and create a more stable revenue
stream. This strategy is particularly appealing when a company's core business is
highly cyclical or susceptible to economic downturns.

Step-4 Vertical Integration Hypothesis: Vertical integration refers to the

integration of a company's supply chain, where a company acquires suppliers or
customers in the same industry. The hypothesis here is that vertical integration can
lead to cost efficiencies, improved control over the supply chain, and reduced
reliance on external partners.

Step-5 Horizontal Integration Hypothesis: Horizontal integration occurs when

companies operating in the same industry and at the same stage of the value chain
merge or acquire each other. The belief here is that this can lead to market
consolidation, increased market share, and potentially reduced competition.

Step-6 Enhanced Clinical Integration and Coordination: The pursuit of better

clinical integration and care coordination is another hypothesis driving M&A in the
healthcare sector. Fragmented healthcare delivery can result in inefficiencies,
suboptimal patient outcomes, and higher costs. By merging or acquiring various
healthcare entities, organizations aim to create a more integrated care continuum.

66
For example, an insurer acquiring a group of primary care clinics and a pharmacy
chain can offer a seamless healthcare experience for its members, leading to
improved adherence to treatment plans and better chronic disease management.
This hypothesis suggests that M&A can foster collaboration among different
healthcare providers and improve the overall quality of care delivered to patients.

Step-7 Access to Innovation and Technology: Innovation plays a vital role in

healthcare, and M&A can serve as a means to access cutting-edge technologies,
research capabilities, and intellectual property. Pharmaceutical companies, for
instance, may acquire biotechnology firms to gain access to promising drug
candidates or advanced research capabilities.

Similarly, healthcare systems may acquire telemedicine startups to expand their

digital health offerings. This hypothesis posits that M&A can accelerate the
development and adoption of innovative healthcare solutions, ultimately benefiting
patients and healthcare providers.

Step-8 Regulatory and Policy Considerations: Regulatory and policy factors

also drive M&A activity in the healthcare sector. Changes in healthcare laws and
regulations can create opportunities or challenges for organizations. For instance,
the Affordable Care Act (ACA) in the United States encouraged healthcare
consolidation by promoting accountable care organizations (ACOs) and value-
based care models.

Healthcare organizations may merge or acquire others to comply with regulatory

requirements, participate in government programs, or navigate evolving
reimbursement structures. This hypothesis suggests that M&A can be a strategic
response to the changing regulatory landscape.

Step-9 Competitive Pressures and Survival: In some cases, M&A in the

healthcare sector is driven by competitive pressures and the need for survival.
Smaller or financially struggling healthcare organizations may see mergers or
acquisitions as a lifeline to remain viable in a highly competitive industry.

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For instance, a community hospital facing financial challenges may merge with a
larger health system to access necessary resources and expertise. This hypothesis
underscores the importance of M&A as a strategic tool for healthcare organizations
to adapt to evolving market dynamics and ensure their long-term viability.

Step-10 Cultural and Organizational Alignment: Successful M&A in the

healthcare sector often hinges on cultural and organizational alignment. The
hypothesis here is that organizations with similar cultures, values, and missions are
more likely to achieve successful integration and realize the intended benefits of
the merger or acquisition.

Mismatched cultures can lead to employee dissatisfaction, resistance to change,

and disruptions in patient care. Therefore, healthcare organizations may prioritize
M&A opportunities that align with their cultural and organizational DNA to
enhance the likelihood of a smooth transition and positive outcomes.

Conclusion:

Mergers and Acquisitions in the healthcare sector are driven by a complex

interplay of economic, strategic, regulatory, and cultural factors. The hypotheses
discussed in this essay provide a framework for understanding the motivations
behind M&A activities in healthcare, ranging from cost efficiencies and market
access to risk mitigation and cultural alignment. These hypotheses are often
interconnected, and the success of an M&A deal depends on various factors,
including careful planning, due diligence, post-merger integration, and the ability
to realize the anticipated benefits. It is essential for companies to critically assess
their motivations and align them with their overall business strategies to ensure
that M&A transactions create long-term value for all stakeholders involved.
Additionally, external factors such as economic conditions, regulatory changes,
and market dynamics can also impact the success of M&A endeavors, making it
crucial for companies to adapt their strategies accordingly. Therefore, stakeholders,
including policymakers, healthcare leaders, and consumers, must critically evaluate
the motivations and outcomes of M&A activities in the healthcare sector to ensure
that they align with the broader goals of improving healthcare access, quality, and
affordability.
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 3.7 SAMPLING FRAMEWORK.

Step-1 Market Attractiveness: It refers to the overall desirability of a particular

market or industry for businesses or investors. It is a concept used in strategic
management and marketing to assess the potential of a market for growth,
profitability, and long-term sustainability. Evaluating market attractiveness helps
businesses make informed decisions about resource allocation, expansion
strategies, and investment opportunities. Here are some key factors that contribute
to market attractiveness. They are as follows:

a) What is the market size?

Market size refers to the total value or volume of a specific market, indicating the
overall scope and potential of a particular industry or product category. It is a
crucial metric for businesses and investors to assess the attractiveness and viability
of entering or expanding within a market. The market size of the Fortis Healthcare
Ltd is one of the largest healthcare services providing in India with 27 Hospitals
which include 4500 operational beds over 426 diagnostics centre as of 30 th
September 2023.
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 b) What is the market growth rate?

Market growth rate refers to the percentage increase or decrease in the total size or
value of a specific market over a defined period of time. It is a crucial metric used
in business and marketing analysis to assess the attractiveness and potential of a
particular industry or market segment. Understanding the market growth rate helps
businesses make informed decisions about investments, resource allocation, and
strategic planning. Fortis Healthcare Ltd has the 27 Hospital all over India like,
they are, In North India- Delhi 6 hospitals, Punjab 3 hospitals, Haryana 2 hospitals,
Rajasthan 1 hospital, Uttar Pradesh 2 hospital. In East India- West Bengal 2
hospitals. In South India- Karnataka 5 hospitals, Tamil Nadu 1 hospitals. In West
India- Maharashtra 4 hospitals.

c) What are the average profit margins?

Average profit margins refer to the average percentage of profit a company makes
on its products or services after subtracting all the costs associated with producing
and selling them. It's a key financial metric that indicates how effectively a
company is generating profits from its core operations. To calculate average profit
margins, you typically use the following formula:

Average Profit Margin (%) = (Total Profit / Total Revenue) x 100

The ratio/financial analysis of FORTIS HEALTHCARE reveals: Operating profit

margins witnessed a fall and stood at 19.0% in FY23 as against 24.6% in FY22.
Net profit margins declined from 13.8% in FY22 to 10.1% in FY23. Debt to Equity
ratio for FY23 stood at 0.1 as compared to 0.1 in FY22.

Step-2 Company attractiveness: "Company attractiveness" refers to the overall

appeal or desirability of a company to various stakeholders, including investors,
employees, customers, suppliers, and partners. It is a subjective assessment of how
attractive or compelling a company is in terms of its business prospects, financial
health, reputation, and other factors. Here are some key aspects of company
attractiveness:
70
 a) How much market share does a company have:
Fortis Healthcare Share Price Returns

1 Day -1.94%

1 Week -2.4%

1 Month 0.7%

3 Months 5.9%

1 Year 24.5%

3 Years 146.23%

5 Years 147.88%

Fortis Healthcare Share Price

335.05-4.70 (-1.38%)
These are the market share price of Fortis Healthcare Ltd as of 30th September
2023. As on 30th June 2023, the company has a total of 75.50 Crore shares
outstanding. Shares of Fortis healthcare crashed nearly 15% on Thursday after the
supreme court refused to lift stay on IHH healthcare open offers. The stock hits a
day’s low of Rs 250.40, down 19.54% from its previous close of Rs 311.20. Fortis
healthcare IPO lot size is 60 shares, and the minimum amount required is Rs 6,600.
According to senses the Fortis healthcare shares price may reach the target of Rs
330 per shares.

b) Is the company Profitable:

Profitability is a critical factor in assessing a company's financial performance and
sustainability. Higher profitability often indicates that a company is efficiently
managing its resources and generating a healthy return on investment, which can
attract investors and contribute to long-term growth and stability.

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In contrast to all that, many investors prefer to focus on company like Fortis
healthcare, which has not only revenue, but also profits. Now this is not to say that
the company presents the best investment opportunity around, but profitability is a
key component to success in business. The revenue of Fortis healthcare stood at Rs
57,449 m in FY-22, which was up to 40.9% compared to Rs 40,767 m reported in
FY-21. Fortis healthcare reported 59% year-on-year jump in net profit to Rs 138
crore in FY-23 led by higher occupancy rates and boost in surgical volumes of
hospital business. The healthcare provider reported net profit of Rs 87 crore in the
corresponding quarter of the PY-22.

c) Does the company have any competitive advantage?

In September 2021, Fortis Healthcare is a leading healthcare provider in India and
other countries. Competitive advantages can vary over time and may be subject to
changes in the industry and the company's strategy. However, some potential
competitive advantages of Fortis Healthcare could include:

Healthcare Infrastructure: Fortis Healthcare has a network of modern hospitals

and healthcare facilities equipped with advanced medical technology and
experienced healthcare professionals. This infrastructure can provide high-quality
medical services to patients, which can be a significant competitive advantage.

Brand Reputation: Fortis Healthcare has built a strong brand reputation in the
healthcare industry, which can attract patients seeking trusted and reliable
healthcare services.

Medical Expertise: The company may have a pool of highly skilled medical
professionals, specialists, and support staff who can offer specialized medical
treatments and services. This expertise can differentiate them from competitors.

Step-3 Synergies: Synergies refer to the concept that the combined efforts or
actions of two or more elements, individuals, or entities can result in a greater
outcome than the sum of their individual efforts. In other words, when elements
work together, they can achieve more than they would if they were working
separately. Synergies are often associated with the idea that the whole is greater
than the sum of its parts.
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 a) Are there potential revenue synergies?

Potential revenue synergies refer to the additional or increased revenue that can be
generated when two or more companies merge or collaborate. These synergies
result from the combined entities' ability to leverage their resources, customer
bases, market presence, or complementary products and services in a way that
creates new opportunities for generating more sales and revenue than the
individual companies could achieve on their own. Fortis revenue for the quarter
ending June 30, 2023 was $1.929B, a 0.93% decline year-over-year. Fortis revenue
for the twelve months ending June 30, 2023 was $8.691B, a 8.84% increase year-
over-year. Fortis annual revenue for 2022 was $8.494B, a 12.68% increase from
2021. Potential revenue synergies can take various forms, including:

Cross-selling: When two companies merge, they can cross-sell each other's
products or services to their existing customer bases. For example, a software
company acquiring a hardware company may offer its software products to the
hardware company's customers, and vice versa.

Up-selling and bundling: The merged entity can upsell existing customers by
offering higher-tier products or services, or by bundling products and services
together at a discounted price. This can increase the average transaction value and
overall revenue.

Market expansion: By combining resources and expertise, the merged company

may enter new geographic markets or customer segments that were previously
untapped. This can lead to increased revenue through expanded market reach.

b) Are there potential cost synergies?

Potential cost synergies refer to the anticipated financial benefits that can be
achieved when two or more companies merge or collaborate in some way. These
synergies typically result from the combination of resources, processes, and
operations, which can lead to cost reductions and improved overall financial
performance. Potential cost synergies can include:
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Economies of Scale: When two companies merge, they often benefit from
economies of scale. This means that as the combined entity produces or purchases
goods and services in larger quantities, it can negotiate better prices from suppliers,
reduce production costs, and optimize distribution and logistics, leading to cost
savings.

Elimination of Redundancies: Mergers or collaborations can often lead to the

elimination of duplicate functions and positions. This includes reducing
overlapping staff, facilities, or administrative overhead. By streamlining
operations, companies can reduce costs.

Consolidation of Operations: Combining operations can lead to the consolidation

of facilities, production lines, or distribution networks. This can reduce rent,
maintenance, and transportation costs associated with running multiple locations.

Step-4 Financial Considerations: Financial considerations refer to the various

factors, calculations, and assessments that individuals, businesses, and
organizations take into account when making financial decisions. These
considerations are crucial in managing and allocating resources, as they can impact
the overall financial health and success of an entity. Financial considerations
typically include:

a) Is the acquisition price reasonable?

The term "acquisition price" typically refers to the total cost or amount of money
that one entity pays to acquire another entity, usually in the context of a business
transaction. This can include the purchase of a company, a division or subsidiary of
a company, or the acquisition of assets or intellectual property.The acquisition
price encompasses various components, such as:

Purchase Price: This is the primary component and represents the actual amount
of money exchanged between the buyer and the seller to complete the acquisition.

74
Assumption of Liabilities: In some acquisitions, the buyer may agree to assume
certain liabilities or debts of the target company. These obligations can be factored
into the acquisition price.

Stock or Equity: In some cases, instead of cash, the acquisition price may include
shares or equity in the acquiring company.

Non-Cash Assets: If non-cash assets like real estate, patents, or other valuable
assets are part of the acquisition, their value is included in the acquisition price.

b) What is the expected increase in annual profit?

The expected increase in annual profit refers to the anticipated growth or rise in a
company's net income or earnings over a specific period of one year. It is a
forward-looking estimate based on various factors such as sales projections, cost
management, market conditions, and other relevant economic indicators. This
expectation of increased profit can be derived from a variety of sources, including:

Revenue Growth: An increase in sales or revenue is a primary driver of higher

profits. This can be achieved through expanding the customer base, entering new
markets, introducing new products or services, or improving existing ones.

Cost Control: Efficient cost management and control measures can contribute to
higher profits. This includes optimizing operational processes, negotiating better
deals with suppliers, and implementing cost-saving initiatives.

Market Conditions: Economic conditions, industry trends, and market demand

can impact a company's profitability. Positive market conditions, favorable
economic indicators, and increased demand for the company's products or services
can contribute to an expected increase in annual profit.

Innovation and Efficiency: Businesses that innovate and improve their

operational efficiency often experience increased profitability. This may involve
adopting new technologies, streamlining processes, or enhancing productivity.

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 3.8 DEMOGRAPHIC OUTLINE OF THE
RESPONDENTS.
Introduction:

Mergers and acquisitions (M&A) in the health sector are critical events that can
have far-reaching impacts on healthcare organizations, patients, and healthcare
professionals. Understanding the demographic profile of respondents involved in
these transactions is essential for gaining insights into the dynamics and trends of
the industry. In this overview, we will delve into the key demographic factors of
the respondents involved in health sector M&A.

Gender: In the health sector, the gender distribution of respondents in M&A

activities has traditionally leaned towards a more balanced representation
compared to some other industries. This balance can be attributed to the relatively
high proportion of women in healthcare professions. Healthcare executives,
including those engaged in M&A, often reflect this gender diversity.

Age: The age of respondents in health sector M&A varies significantly, reflecting
the diverse roles and career stages of those involved. In general, healthcare M&A
transactions involve a mix of younger professionals looking to make their mark in
the industry and seasoned veterans with extensive experience. Younger
respondents often include analysts, consultants, and junior executives, while older
respondents typically occupy leadership positions, such as CEOs and CFOs.

Educational Background: Respondents in health sector M&A typically possess

diverse educational backgrounds, mirroring the multifaceted nature of the
healthcare industry. Common educational qualifications among respondents
include:

Medical degrees (MD, DO), Business degrees (MBA), Legal degrees (JD), Health
administration degrees (MHA, MPH), Nursing degrees (BSN, MSN), Pharmacy
degrees (PharmD), Life sciences and biomedical degrees (PhD).

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The diversity in educational backgrounds ensures that healthcare M&A teams have
a wide range of expertise, enabling them to navigate the complex regulatory,
financial, and clinical aspects of transactions effectively.

Professional Roles: Health sector M&A involves a broad spectrum of

professionals, each playing a unique role in the transaction process. Some of the
key roles and their demographics include:

Healthcare Executives: CEOs, CFOs, and COOs are often the key decision-
makers in healthcare organizations involved in M&A. They tend to be more
experienced, with a median age typically ranging from the late 40s to early 60s.

Financial Analysts: Financial analysts, investment bankers, and private equity

professionals play crucial roles in evaluating the financial feasibility of M&A
deals. They often have diverse educational backgrounds and span various age
groups.

Legal Experts: Lawyers specializing in healthcare and M&A law are essential for
navigating complex regulatory requirements. Legal teams can comprise
professionals of varying ages and genders, with substantial experience in
healthcare law.

Consultants: Management and healthcare consultants provide strategic advice to

healthcare organizations considering M&A. These professionals can be relatively
young and often possess business or healthcare administration degrees.

Healthcare Providers: Physicians, nurses, and other healthcare providers may be

consulted during M&A to assess clinical and operational aspects. Their ages vary
widely, depending on their career stage and specialization.

Geographic Location: The geographic location of respondents in health sector

M&A can vary significantly based on the specific deal and the organizations
involved. Major healthcare hubs such as New York, Boston, San Francisco, and
Houston tend to have higher concentrations of professionals engaged in M&A
activities due to the presence of numerous healthcare institutions, investment firms,
and law firms specializing in healthcare.
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Pharmaceutical M&A: This sub-sector involves professionals with backgrounds
in pharmaceutical science, regulatory affairs, and finance. Biotechnology
companies often engage in these transactions, requiring specialized knowledge.

Regulatory Expertise: Given the highly regulated nature of the healthcare

industry, respondents involved in health sector M&A often include individuals
with expertise in healthcare regulations. This includes professionals with
experience in healthcare compliance, HIPAA (Health Insurance Portability and
Accountability Act) experts, and specialists in FDA regulations for pharmaceutical
and medical device companies.

Stakeholder Engagement: Health sector M&A often involves engaging with

various stakeholders, including patients, healthcare professionals, government
agencies, and advocacy groups. Respondents involved in stakeholder engagement
may include patient advocates, communication specialists, and government
relations experts.

Conclusion:

The demographic outline of respondents in health sector M&A is diverse and

dynamic, reflecting the multifaceted nature of the healthcare industry. Gender
balance, age diversity, educational backgrounds, and specialized expertise are key
characteristics of these respondents. As the healthcare landscape continues to
evolve, so too will the composition of M&A teams, with a growing emphasis on
diversity and inclusivity, regulatory expertise, and stakeholder engagement.
Understanding these demographic factors is essential for healthcare organizations
and professionals seeking successful outcomes in the complex world of health
sector mergers and acquisitions.

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 3.9 TOOLS FOR DATA COLLECTION.
Data collection in the field of healthcare mergers and acquisitions (M&A) is a
crucial process that involves gathering, analyzing, and synthesizing information
about the target organizations. Here are some tools and methods commonly used
for data collection in healthcare M&A:

Due Diligence Checklist: A comprehensive due diligence checklist is a

fundamental tool. It outlines the specific documents and data that need to be
collected from the target organization, such as financial statements, contracts, legal
documents, regulatory compliance records, and operational reports.

Financial Analysis Software: Financial analysis tools like Excel, financial

modeling software, and accounting software are used to assess the financial health
of the target organization. These tools can help in creating financial projections,
evaluating revenue and cost structures, and assessing the impact of the merger on
the financials.

Electronic Health Records (EHR) Systems: In the healthcare sector, EHR

systems contain vital patient data, clinical records, and operational information.
Access to and analysis of EHR data can provide insights into patient
demographics, treatment outcomes, and operational efficiency. Data extraction and
analysis tools are used to extract and analyze data from these systems.

Healthcare Analytics Platforms: Healthcare analytics platforms are used to

process and analyze large volumes of healthcare data, including claims data,
clinical data, and patient outcomes data. These platforms can provide insights into
patient populations, reimbursement trends, and quality of care.

Regulatory Compliance Tools: Compliance tools are used to assess the target
organization's adherence to healthcare regulations and standards, such as HIPAA
(Health Insurance Portability and Accountability Act) in the United States. These
tools can help identify potential compliance risks.

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Market Research Tools: Market research tools and databases can provide
information about the target organization's market share, competitive landscape,
and growth potential. This data is valuable for evaluating the strategic fit of the
merger.

Qualitative Data Collection Methods: Interviews, surveys, and focus groups with
key stakeholders, including physicians, staff, and patients, can provide qualitative
insights into the culture, reputation, and perception of the target organization.

Legal and Contract Review Tools: Legal due diligence involves reviewing
contracts, agreements, and legal documents. Document management systems and
legal software can streamline this process.

Data Room Software: Virtual data room (VDR) software is used to securely share
and access confidential documents and data during the due diligence process.
VDRs provide audit trails and access controls for sensitive information.

Data Integration Platforms: Data integration tools are essential for combining
data from various sources, such as financial systems, EHRs, and operational
databases. They ensure that data is consistent and accurate for analysis.

Data Security and Privacy Tools: Given the sensitive nature of healthcare data,
tools for data security and privacy compliance, such as encryption and access
controls, are crucial to protect patient information during M&A activities.

Project Management Software: Project management tools help in coordinating

the data collection process, assigning tasks, setting deadlines, and tracking progress
to ensure that all necessary data is collected on time.

Enterprise Resource Planning (ERP) Systems: For a comprehensive

understanding of the target's operational processes and systems. Systems like SAP,
Oracle, or Microsoft Dynamics are commonly used in the health sector to collect
data on supply chain, inventory management, and overall business operations.

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Customer Relationship Management (CRM) Systems: To understand the
target's customer base and relationships. CRM tools such as Salesforce or HubSpot
can provide insights into customer interactions, satisfaction, and potential risks or
opportunities. It refers to a set of strategies, practices, and technologies that
organizations use to manage and analyze interactions with their current and
potential customers. The primary goal of CRM is to improve customer satisfaction,
loyalty, and retention while also increasing sales and revenue.

Communication and Collaboration Platforms: Facilitate seamless

communication and collaboration among the M&A team. Platforms like Slack,
Microsoft Teams, or Asana help in coordinating efforts, sharing updates, and
managing tasks during the M&A process.

Cyber security Assessment Tools: To evaluate the target's cyber security

measures, especially critical in the healthcare sector to protect sensitive patient
data. Cyber security assessment tools, penetration testing tools, and risk
management platforms can be employed for this purpose.

Conclusion:

In conclusion, tools for data collection play a critical role in the research and
decision-making processes across various domains. These tools have evolved
significantly in recent years, offering researchers, businesses, and individuals a
wide array of options to collect, analyze, and interpret data. The choice of data
collection tools should be based on the specific needs of the project, the type of
data being collected, and the resources available. Ultimately, the success of any
data collection endeavor hinges on thoughtful planning, rigorous methodology, and
the appropriate use of tools to gather and analyze data. With the right tools and
techniques, organizations and researchers can extract valuable insights, make
informed decisions, and drive positive outcomes in their respective fields.

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 3.10 DOWNFALL, BENEFITS, LIMITATION OF THE
STUDY.

I. Downfall of the study:

Mergers and acquisitions (M&A) in the healthcare sector have become

increasingly common in recent years. Healthcare organizations often pursue M&A
activities for various reasons, including expanding their market share, improving
operational efficiency, accessing new technologies, and achieving cost savings.
While M&A can offer numerous benefits, there are also significant downsides and
challenges associated with these transactions in the healthcare sector. In this essay,
we will explore the potential drawbacks of M&A in healthcare in detail.

Increased Healthcare Costs: One of the most significant concerns with healthcare
M&A is the potential for increased costs. When two healthcare organizations
merge, they may create a larger, more dominant entity in a particular market.
While proponents argue that economies of scale can lead to cost savings, there is
evidence to suggest that mergers often result in higher healthcare prices for
consumers. The reduced competition can lead to monopolistic pricing power,
which harms patients and payers.

Reduced Access to Care: Mergers and acquisitions can lead to the consolidation
of healthcare providers and facilities. While consolidation may improve the
efficiency of operations, it can also result in the closure or downsizing of certain
facilities, particularly in rural or underserved areas. This reduction in access to care
can be detrimental to patients who rely on these facilities for essential medical
services.

Quality of Care Concerns: The quality of care can be negatively impacted by

M&A activity. Integrating different healthcare systems and cultures can be
challenging, and it may take time for staff to adapt to new processes and protocols.
This transitional period can lead to disruptions in patient care and potentially
compromise patient safety. Furthermore, a focus on cost-cutting measures, such as
staff layoffs, can affect the quality of care provided.
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Loss of Innovation: Healthcare M&A can stifle innovation in the industry. When
large organizations acquire smaller, innovative companies, they may prioritize cost
reduction and integration over the development of cutting-edge technologies and
treatments. This can hinder progress in healthcare and limit the availability of
innovative solutions for patients.

Market Monopoly and Reduced Competition: As mentioned earlier, M&A in

healthcare can lead to market consolidation, resulting in a reduction in competition.
When a few dominant players control a significant portion of the market, they can
dictate prices and terms to the detriment of consumers. This lack of competition
can discourage innovation and limit consumer choice.

Regulatory Challenges: Healthcare M&A transactions often face complex

regulatory hurdles. Regulatory bodies, such as the Federal Trade Commission
(FTC) in the United States, closely scrutinize healthcare mergers to ensure they do
not create anti-competitive situations that harm consumers. Navigating these
regulatory challenges can be time-consuming and costly, and there is no guarantee
that a proposed merger will receive regulatory approval.

Cultural Integration Issues: Integrating the cultures of two healthcare

organizations can be a significant challenge. Each organization may have its own
values, practices, and approaches to patient care. Merging these cultures
successfully can be difficult and may lead to employee dissatisfaction and
turnover. When healthcare professionals are not aligned in their values and
practices, it can affect the quality of care provided to patients.

Financial Risks: Mergers and acquisitions can be financially risky endeavors. The
costs associated with due diligence, legal fees, integration, and potential
restructuring can be substantial. Additionally, if the integration process is not
managed effectively, it can result in financial losses for the merged entity. This can
impact the organization's ability to invest in patient care and other strategic
initiatives.

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Data Privacy and Security Concerns: In an era where healthcare organizations
handle vast amounts of sensitive patient data, M&A transactions can introduce data
privacy and security risks. The integration of IT systems and the sharing of patient
information between organizations can increase the likelihood of data breaches and
cyber security vulnerabilities. Protecting patient data becomes even more critical
during M&A activities.

Employee Morale and Burnout: Healthcare professionals often experience stress

and burnout due to the demands of their work. Mergers and acquisitions can
exacerbate these issues. The uncertainty and disruption caused by M&A
transactions can lead to decreased employee morale and job satisfaction. This, in
turn, can impact the quality of care provided to patients.

Conclusion:
While mergers and acquisitions in the healthcare sector can offer potential benefits
such as improved efficiency and access to resources, they also come with
significant drawbacks and challenges. These include increased healthcare costs,
reduced access to care, concerns about the quality of care, stifled innovation,
reduced competition, regulatory hurdles, cultural integration issues, financial risks,
data privacy concerns, and negative impacts on employee morale and burnout.
Therefore, healthcare organizations must carefully consider these factors and
weigh the potential risks against the benefits when contemplating M&A activities
in the healthcare sector. Effective planning, communication, and a focus on
maintaining the quality of care should be priorities during these complex
transactions to mitigate some of the potential downsides.

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III. Benefits of the study:
Mergers and acquisitions (M&A) in the healthcare sector have become
increasingly common in recent years. These strategic transactions involve the
combination of two or more healthcare organizations, such as hospitals,
pharmaceutical companies, biotechnology firms, or healthcare technology
providers. M&A activities in the healthcare sector offer a range of potential
benefits, which can positively impact patients, healthcare providers, and
stakeholders in the industry. In this essay, we will explore the various benefits of
mergers and acquisitions in the healthcare sector, delving into the ways in which
these transactions can enhance the efficiency, quality, and accessibility of
healthcare services.

Economies of Scale and Cost Efficiency: One of the primary benefits of mergers
and acquisitions in the healthcare sector is the potential for achieving economies of
scale. When healthcare organizations combine their resources, they can often
reduce duplication of administrative functions, streamline operations, and negotiate
better terms with suppliers. These efficiencies can lead to significant cost savings,
which can be reinvested in improving patient care, expanding services, or lowering
healthcare costs for consumers.

Enhanced Access to Capital: M&A transactions in the healthcare sector often

provide access to substantial capital that can be used for infrastructure upgrades,
technology investments, and expansion of healthcare services. This is especially
important in an industry where advancements in medical equipment and
technology are crucial for delivering high-quality care. Large healthcare
organizations resulting from mergers are better positioned to secure financing and
investments for modernizing facilities and adopting innovative healthcare
technologies, such as electronic health records (EHRs), telemedicine platforms,
and advanced diagnostic equipment. These investments can improve patient
outcomes, reduce errors, and enhance the overall quality of care.

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Improved Quality of Care: Mergers and acquisitions can lead to improved
quality of care through standardization of practices, sharing of best practices, and
the ability to attract top talent. Larger healthcare organizations often have the
resources to invest in continuous training and development for their staff, ensuring
that healthcare providers stay current with the latest medical advancements and
techniques.

Geographic Expansion and Access to New Markets: Mergers and acquisitions

can facilitate geographic expansion and help healthcare organizations access new
markets. This is particularly relevant in regions where healthcare services are
unevenly distributed or where specific healthcare needs are underserved. By
merging with or acquiring organizations in these areas, healthcare providers can
expand their reach and offer their services to a broader patient population.

Research and Innovation: M&A activities in the healthcare sector can foster
research and innovation. Pharmaceutical and biotechnology companies, in
particular, can leverage their combined resources to accelerate drug discovery,
development, and clinical trials. This collaborative approach can lead to the faster
introduction of new treatments and therapies to address various diseases and
medical conditions.

Synergies in Healthcare Technology: Healthcare technology plays a crucial role

in improving patient care, reducing costs, and enhancing operational efficiency.
M&A transactions often lead to synergies in healthcare technology, as
organizations combine their IT infrastructure and expertise. For instance, the
integration of electronic health records (EHRs) and telemedicine platforms
becomes more seamless in merged healthcare systems.

Negotiating Power with Payers: The negotiation of reimbursement rates with

insurance companies and government payers is a critical aspect of the healthcare
industry. Larger healthcare organizations resulting from mergers and acquisitions
often have increased bargaining power when dealing with payers. This can lead to
more favorable reimbursement agreements, which, in turn, can help stabilize and
improve the financial viability of healthcare providers.

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Enhanced Risk Management: The healthcare sector is inherently fraught with
various risks, including regulatory compliance, legal liabilities, and cybersecurity
threats. Mergers and acquisitions can enhance risk management by combining
resources and expertise to address these challenges more effectively.

Adaptation to Changing Healthcare Landscape: The healthcare industry is

continually evolving, driven by advancements in medical science, changes in
healthcare policy, and shifts in patient preferences. Mergers and acquisitions allow
healthcare organizations to adapt more effectively to these changes by creating
more agile and flexible entities.

Enhanced Population Health Management: Mergers and acquisitions can also

improve population health management. By consolidating patient data and
resources, healthcare organizations can develop more comprehensive and data-
driven approaches to preventive care, chronic disease management, and health
promotion.

Conclusion:

Mergers and acquisitions in the healthcare sector offer a multitude of benefits that
extend beyond financial gains. These strategic transactions have the potential to
enhance the efficiency, quality, and accessibility of healthcare services. From cost
savings and improved access to capital to better quality of care, geographic
expansion, and innovation, M&A activities can positively impact patients,
healthcare providers, and the healthcare industry as a whole. However, it's
important to note that successful M&A transactions require careful planning,
thorough due diligence, and effective post-merger integration to realize these
benefits fully. Nevertheless, when executed thoughtfully, mergers and acquisitions
have the potential to shape a more robust and responsive healthcare ecosystem,
ultimately benefiting society by delivering better healthcare outcomes.

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 I. Limitation of the study:
Mergers and acquisitions (M&A) in the healthcare sector have become
increasingly prevalent in recent years as organizations seek to consolidate their
resources, expand their market presence, and improve their competitive advantage.
While M&A activities offer several potential benefits, they also come with
significant limitations and challenges that are particularly pronounced in the
complex and highly regulated healthcare industry. In this essay, we will explore
the limitations of mergers and acquisitions in the healthcare sector in detail.

Regulatory Challenges: The healthcare sector is one of the most heavily regulated
industries globally, with strict oversight from government agencies, such as the
Food and Drug Administration (FDA) in the United States. Mergers and
acquisitions often require approval from regulatory bodies to ensure that they do
not stifle competition, reduce access to care, or raise prices. This regulatory
scrutiny can result in lengthy approval processes, significant legal costs, and
uncertainty about whether a deal will ultimately be approved.

Complex Integration: The integration of two healthcare organizations, such as

hospitals or healthcare systems, can be an incredibly complex and time-consuming
process. These entities typically have intricate infrastructures, including electronic
health records (EHRs), billing systems, and clinical protocols, which must be
harmonized. Integrating these systems while maintaining patient care quality can
be challenging and costly.

Financial Considerations: Mergers and acquisitions often require substantial

financial resources. The healthcare sector is no exception, and the costs associated
with due diligence, legal and regulatory compliance, integration, and potential
divestitures can be substantial. Healthcare organizations may also face increased
borrowing costs due to the added financial risk associated with M&A activities,
impacting their overall financial health. Additionally, it can take several years
before the financial benefits of a merger or acquisition are fully realized. During
this time, organizations may experience operational disruptions and increased
expenses, potentially affecting their ability to provide care and maintain
profitability.
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Patient Care Disruption: One of the most significant limitations of M&A in the
healthcare sector is the potential for patient care disruption. The process of
merging or acquiring healthcare facilities can lead to a temporary drop in service
quality, as staff may be preoccupied with integration efforts rather than patient
care. This can result in longer wait times, decreased access to care, and lower
patient satisfaction.

Data Privacy and Security Concerns: Healthcare organizations handle vast

amounts of sensitive patient data, and M&A activities can raise significant data
privacy and security concerns. Integrating electronic health records and other
patient information systems must be done carefully to protect patient
confidentiality and comply with data protection regulations like the Health
Insurance Portability and Accountability Act (HIPAA) in the United States.

Quality of Care and Patient Outcomes: Mergers and acquisitions can impact the
quality of care and patient outcomes in several ways. When organizations prioritize
cost-cutting during integration, it may lead to staff reductions or the consolidation
of medical services, potentially compromising the quality of care provided.

Workforce Issues: The healthcare workforce is a critical component of the

industry, and M&A activities can create workforce challenges. Employees may
experience uncertainty about their job security, roles, and reporting structures
during the merger or acquisition. This can result in decreased morale and
productivity, potentially impacting patient care. Retaining and recruiting skilled
healthcare professionals can also be challenging in the wake of M&A activities,
especially if there is a perception that the merger or acquisition has negatively
affected job stability or career advancement opportunities.

Patient Access and Equity: M&A activities can affect patient access and
healthcare equity. In some cases, consolidation can lead to the closure of
healthcare facilities in underserved or rural areas, limiting access to care for
vulnerable populations. Moreover, M&A can exacerbate healthcare disparities by
concentrating resources and services in urban areas while reducing access in rural
or economically disadvantaged regions.

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Innovation and Competition: Mergers and acquisitions in the healthcare sector
may inadvertently stifle innovation and competition. When larger healthcare
organizations dominate a market, they may have less incentive to invest in new
technologies, treatments, or research. This can hinder progress and limit the
introduction of new, potentially life-saving therapies or diagnostic tools.
Furthermore, consolidation can deter smaller, innovative startups from entering the
healthcare market, as they may face barriers to competing with larger, more
established entities.

Geographic and Market-Specific Challenges: The limitations of M&A in the

healthcare sector can vary significantly based on geographic location and market
conditions. In some regions, healthcare consolidation may be necessary to improve
efficiency and access, while in others, it may exacerbate existing problems.
Therefore, the impact of M&A activities must be assessed on a case-by-case basis.

Conclusion:

While mergers and acquisitions in the healthcare sector can offer various benefits,
such as economies of scale and improved resource allocation, they are not without
significant limitations and challenges. These limitations include regulatory hurdles,
complex integration processes, financial considerations, potential disruptions to
patient care, data privacy concerns, and workforce issues. Additionally, M&A
activities can affect the quality of care, patient access, healthcare equity,
innovation, and competition. Given the complexity of the healthcare industry and
the critical importance of accessible and high-quality care, stakeholders must
carefully evaluate the potential drawbacks of M&A activities and implement
strategies to mitigate these limitations for the benefit of patients and the broader
healthcare system.

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 CHAPTER- 4
SWOT ANALYSIS.

SWOT analysis is a strategic planning tool used by organizations and individuals

to assess their current situation or a specific project or endeavor. The acronym
"SWOT" stands for Strengths, Weaknesses, Opportunities, and Threats. Here's
what each component of a SWOT analysis means:

Strengths: These are the internal positive attributes or factors that an organization
or individual possesses. Strengths could include things like a strong brand
reputation, skilled employees, efficient processes, proprietary technology, or a
loyal customer base.

Weaknesses: Weaknesses are also internal but represent negative attributes or

factors that can hinder progress or success. Weaknesses might include a lack of
resources, outdated technology, poor management, or high employee turnover.

Opportunities: Opportunities are external factors or situations that could potentially

benefit the organization or individual. These could be emerging markets, new
technologies, changes in consumer behavior, or trends that align with the
organization's strengths.

Threats: Threats are external factors or challenges that could pose risks or
obstacles to the organization or individual. Threats might include competition,
economic downturns, regulatory changes, or shifts in consumer preferences that
could negatively impact the organization.
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SWOT analysis is a valuable tool for strategic planning, decision-making, and
problem-solving in various contexts, including business, healthcare, education, and
personal development. It provides a structured framework for evaluating the
internal and external factors that can influence an organization's or individual's
success.

4.1 Strengths of Fortis Healthcare

A company gets its competitive advantage from the various strengths that it
possesses. Let’s look at the strengths of Fortis.

Improvement– Fortis Healthcare believes in continuous improvement and invests

in methods that can help them enhance the brand and its services. It tries to keep
developing its services in various specialty areas such as medicine. Fortis
Healthcare also makes a huge investment in Research and Development which has
proven to help the company in implementing high-quality healthcare services.

Employees– Fortis Healthcare has a highly qualified staff recruited by a thorough

system of the human resources team. They even provide regular training to their
team of doctors and support staff, so they can specialize in their areas. This helps
them develop a remarkable work ethic that improves the delivery of patient care.

Patient Care– Fortis Healthcare realizes that patient care is of utmost importance
to achieve its vision. So, their staff provides a range of services along with
emergency and trauma care. They aim to give each patient proper attention and
make them feel comfortable.

Quality Accreditations- The facilities and systems of Fortis Healthcare match

industry benchmarks. This is how they achieve certifications such as NABH.
Thereby, promoting standardization when it regards qualified professionals
fulfilling services.

Along with this, Fortis Healthcare has many branches which add to its strengths.

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 4.2 Weaknesses of Fortis Healthcare
Weaknesses are drawbacks a company has, it needs to consistently work on them
to remove them.

Shifting Brand Focus– Fortis Healthcare has decided to shift its brand focus to
India only and not pursue global recognition. They did this as they believe India is
highly dedicated to increasing their healthcare system which will help their
company grow. But, this situation is likely to change in the future and affect
Fortis’s delivery.

Expensive Services – Fortis Healthcare has been on the top of the list of hospitals
that provide services at high prices. There have been complaints that the expenses
are better suited for international clients. Due to their expensive services, local
patients are not able to get proper care and get buried under debt.

4.3 Opportunities of Fortis Healthcare

Opportunities are factors that help in the growth of any organization if identified
and worked upon at the right time. Let’s see some opportunities for Fortis
Healthcare.

Growing Health Concerns- The Internet today, has aided information that has
made people more anxious about their health. Especially after the pandemic,
people are putting more effort into taking care of their health and looking for
professionals who can help them. This is an opportunity for Fortis and its team of
specialists.

Medical Tourism – India has gained the status of medical tourism. The country is
recognized globally for providing quality services by trained professionals at
cheaper rates. Thus, making this an opportunity for Fortis Healthcare.

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 4.4 Threats of Fortis Healthcare
Threats are harms that can hinder the growth of any organization if not worked on
properly. Let’s look at some of the threats to Fortis Healthcare.

Competition– To gain a competitive advantage, Fortis Healthcare needs to

strategize to deal with its competitors. Apollo hospital is their biggest competitor
and now, even local hospitals like Narayan Healthcare pose strong competition.

Prohibitive Healthcare Costs – The delivery of services is being highly affected

by the rising healthcare costs. It’s getting hard for people to afford quality
healthcare and difficult for healthcare service providers to reduce costs in fear of
losses.

Conclusion

Fortis Healthcare has been gaining popularity in the market, especially after its
services and support to beat Covid-19. It has become an important player to look
out for. Despite facing strong competition, Fortis Healthcare has been able to keep
a hold of its market share due to its investments, specifically inpatient care, but the
company needs to strategize to its services more affordable for the local class.
Only then, the company will be able to achieve its vision of becoming the World’s
Most Trusted Healthcare Provider. Other than that, Fortis Healthcare’s growth
seems very promising. The company can improve its visibility furthermore by
using digital marketing as after the pandemic everything has shifted online.

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 CHAPTER- 5
DATA ANALYSIS AND INTERPRETATION.
Data analysis and interpretation in the context of mergers and acquisitions (M&A)
refers to the process of collecting, examining, and making sense of various types of
data to assess the potential benefits and risks associated with a merger or
acquisition. It involves using data to gain insights into the financial, operational,
and strategic aspects of the target company and the acquiring company. Data
analytics are essential for making informed and strategic decision in mergers and
acquisition. They can help you identify the determine the optimal valuation and
deal structure.

In the process of analyzing acquisition falls broadly into three stages: Planning,
Search and Screen, and Financial Evaluation. The acquisition planning process
begins with a review of corporate objectives and product-market strategic business
units. According to technology-enabled data management practice can drive
mergers and acquisition transaction value by helping companies close deals
quickly, cost-effectively and with less risk. Mergers and acquisition is often used
to increase shareholders value, obtain strategic assets, and drive synergies between
the organization. The main function of an mergers and acquisition analyst is to
provide technical support to a company strategy, examine market opportunities and
support negotiations in company mergers and acquisitions.

In data analysis and interpretation financial analysis is a critical step during a

mergers and acquisition process. It helps to assess the financial performance of the
target company, identify potential risks and opportunities, and its determines if the
deal is financially viable. One of the most obvious and important way to measure
the success and impact of mergers and acquisition leadership is to use financial
metrics that reflect the value of profitability of the deal. These can include revenue
growth, cost synergies, earning per share, return on investment capital, cash flow,
and market share. You should compare these metrics with your pre-deal projection,
industry benchmarks, and competitor’s performance to evaluate how well you
achieved your financial goals and how you can optimize your results.
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5.1 DETAILS OF TOOLS USED FOR DATA ANALYSIS.
Technological advances continue to accelerate the rapid growth of many data sets,
with institutions generating a lot of data daily. Some everyday activities that
produce big data for organizations include customer interactions, communication
on various digital platforms, financial transactions, barcode scanning, digital files,
and documents, among others. In its raw and unstructured form, such data can be
challenging to understand or use, rendering it invaluable to an organization.

Data analytics refers to scientific techniques and processes that analyze raw data
and convert it into information. It enables organizations to make strategic business
decisions for efficiency and optimal business performance. As organizations strive
to thrive in fluid business environments characterized by cutthroat competition, the
need for mergers and acquisitions continues to grow. We at Deal Room help
dozens of companies organize their M&A process and here we'll explain how data
analytics help business to grow. In brief, mergers occur when two separate entities
combine to create a new joint organization, while acquisitions refer to the takeover
of one entity by another.

Data analysis plays a crucial role in the process of mergers and acquisitions
(M&A) as it helps companies evaluate the financial, operational, and strategic
aspects of a target company. Various tools and techniques are used in this analysis.
The term data analytics can instill a sense of dread if you don't like statistics. This
mustn't be the case today, given the variety of software tools that allow you to
easily export data or pull information from an app without any need for technical
skills. Today, we have businesses dedicated to providing solutions that enable you
to sync information between apps seamlessly. For instance, you can effortlessly
do sales force google sheets integration from the comfort of your office.

Here are some of the common tools and methods used in M&A data analysis:

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Types of tools used for data analytics for M&A

Four main categories of data analytics facilitate M&A. Powered by specialized

systems and software to facilitate data analysis; these four categories of data
analytics include:

1. Descriptive Analytics:
This is the most commonly used data in business. Descriptive analytics
summarizes past data, usually on dashboards that provide historical information.
Business applications of descriptive analysis include KPI (Key Performance
Indicator) dashboards, monthly revenue reports, and sales lead overviews. For
instance, descriptive analytics would show dealers how a targeted company's stock
performed on the market within a specified period.

2. Diagnostic Analytics:

This type of analytics helps to explain the factors that influenced an occurrence.
Diagnostic analysis gathers cues and insights from descriptive analytics to further
establish the causes of specific outcomes. For instance, descriptive analytics would
help highlight the factors affecting your target company's stock market
performance during a period. Dealers use diagnostic analysis to create connections
between data and business trends.

3. Predictive Analytics:

This helps to forecast possible future outcomes. Predictive analytics rely on

statistical modeling to make accurate and logical predictions about possible future
events. During M&A, predictive analytics can help assess a target organization's
future risks. This is enabled through sales forecasting, team member productivity,
and success forecasting. Predictive analytics help dealers identify profitable M&A
deals and go the entire cycle or end poor deals.

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4. Prescriptive Analytics:

This is considered the frontier of data analytics. It combines state-of-the-art

technology with insights from the three analytics types described above. Predictive
analytics utilizes costly technology and data practices that require considerable
investment resources. Artificial Intelligence (AI) systems are examples of
prescriptive tools whose analytics engines have been shown to speed up M&A
deals while lowering costs and reducing risk.

Benefits from using data analytics during M&A:

1. High-Quality Information:

Data analytics provide dealers with structured data sets as information, enabling
them to visualize and test crucial aspects of the M&A project. The lack of quality
data analytics software can cause dealers to depend on low-quality data and
information. This often leads to misinformation that is time-consuming and costly
during M&A projects. Data analytics enables dealers to make quality decisions
based on rich data availed within a shorter duration that helps save time and costs.

2. Navigating Loads of Data at High Speed:

The amount of data available to any business today serves no purpose if it's not
analyzed effectively to generate meaningful information. During M&A, time is of
the essence, yet dealers must go through volumes of data to make good decisions.
Data analytics classifies tons of disorganized market and business data, helping
dealers with vital information concerning the M&A.

3. Identifying the Ideal Target:

During M&A, data analytics provides organizations with statistics that enable you
to see the bigger picture regarding the deal's impact on a company's strategic
position. Data analytics can help you to visualize the direction of the new entity to
be formed, including its probability of success or failure. For instance, predictive
analytics can help you to forecast how markets will react to the new business,
informing you whether your target enhances the deal's viability.
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4. Smooth Post-Deal Integration:

Data analytics also help to accelerate integration processes between the M&A
organizations after the deal is closed. M&A usually brings cultural and personality
clashes to the fore as employees from different organizations work to gel and adapt
to a new culture that may be significantly different for acquired companies. Data
analytics can speed up the transition process by reducing the time spent on power
struggles and personality clashes.

Conclusion:

Execution speed is a crucial indicator of successful M&A deals. Today, businesses

generate a lot of raw data that isn't as useful in an amorphous form. Information
overload can lead to M&A deals that become costly financial mistakes. Data
analytics increases your chances of executing successful M&A deals by availing
multiple quality data sets already processed into high-quality information. Many
companies offer data analytics services, so you don't need technical qualifications
to conduct the next M&A deal or inform a critical business decision. Acquiring
data integration software will automatically turn you into a statistician and increase
your chances of making accurate data-driven decisions. It's important to note that
the specific tools and techniques used in M&A data analysis can vary depending
on the size and nature of the deal, the industries involved, and the company's
preferences. Additionally, collaboration and communication tools are crucial for
coordinating the efforts of various teams and stakeholders involved in the M&A
process.

99
 5.2 DATA ANALYSIS AND INTERPRETATION.
5.2.1 TABLE AND CHART SHOWING OVERVIEW OF
FINANCIAL DATA ANALYSIS.
1) REVENUE DATA:

In the fiscal year 2020-2021, Fortis Healthcare, a leading healthcare provider in

India, reported a total revenue of approximately INR 5,041 crores (around $680
million USD). This figure represents the income generated by Fortis Healthcare
through its various healthcare services, including hospitals, diagnostic centers, and
healthcare facilities across the country. Fortis Healthcare's revenue is primarily
driven by the provision of medical services, including inpatient and outpatient care,
surgeries, diagnostics, and specialized treatments. The company operates a
network of hospitals and clinics that cater to a wide range of medical needs, from
routine check-ups to complex surgical procedures. It's important to note that Fortis
Healthcare's revenue can fluctuate from year to year due to various factors,
including changes in patient volumes, healthcare trends, and economic conditions.
The COVID-19 pandemic, for example, had a significant impact on healthcare
providers worldwide, including Fortis Healthcare, leading to both challenges and
opportunities in the healthcare sector. Overall, Fortis Healthcare's revenue in 2020-
2021 reflects its position as a prominent player in India's healthcare industry,
dedicated to delivering quality healthcare services to patients across the country.

100
2) NET PROFIT:

In 2021, Fortis Healthcare, a leading healthcare service provider in India, reported

a net profit of approximately INR 312 crores (Indian Rupees) or roughly $42
million USD. This net profit figure reflects the company's financial performance
over the specified period. Several factors contributed to Fortis Healthcare's net
profit in 2021. Firstly, the COVID-19 pandemic played a significant role as the
demand for healthcare services surged during the crisis, leading to increased
hospital admissions, diagnostic tests, and elective procedures. Additionally, cost
management and operational efficiency initiatives, including resource optimization
and procurement strategies, positively impacted the company's bottom line. Fortis
Healthcare's robust network of hospitals and healthcare facilities across India
allowed it to cater to a broad patient base. Furthermore, strategic partnerships,
collaborations, and investments in cutting-edge medical technologies may have
further enhanced its revenue generation and profitability.

It's important to note that net profit is just one aspect of a company's financial
performance, and a comprehensive financial analysis should consider various other
factors, such as revenue, expenses, assets, and liabilities, to provide a complete
picture of the company's financial health.

101
3) EARNING PER SHARE (EPS):

Fortis Healthcare, a leading healthcare provider, reported its EPS for a specific
fiscal period, which reflects its profitability on a per-share basis during that time
frame. EPS is calculated by dividing the company's net income attributable to
common shareholders by the total number of outstanding common shares.

For instance, if Fortis Healthcare earned a net income of $100 million for a given
year and had 50 million common shares outstanding during that year, the EPS
would be calculated as:

EPS = Net Income / Number of Common Shares Outstanding EPS = $100,000,000

/ 50,000,000 shares = $2 per share

This means that, on average, each common shareholder would have earned $2 in
profit for each share they held. EPS is a key financial indicator used by investors to
assess a company's profitability and its ability to generate returns for shareholders.
It can also be a crucial factor in stock valuation and investment decisions, as higher
EPS often indicates stronger financial performance.

102
4) BOOK VALUE PER SHARE (BVPS):

Book value per share for Fortis Healthcare in a specific year can be calculated by
dividing the company's total shareholders' equity by the number of outstanding
shares. It represents the net asset value of the company on a per-share basis and
provides insight into the company's intrinsic value.

Suppose, for example, Fortis Healthcare had total shareholders' equity of $1 billion
in a given year, and there were 100 million outstanding shares. In this case, the
book value per share would be:

Book Value per Share = Total Shareholders' Equity / Number of Outstanding

Shares Book Value per Share = $1,000,000,000 / 100,000,000 Book Value per
Share = $10

This means that in that specific year, each share of Fortis Healthcare represented
$10 in net assets. Investors often compare the book value per share to the current
market price per share to assess whether a stock is undervalued or overvalued. If
the market price per share is lower than the book value per share, it may indicate
that the stock is undervalued, but other factors should also be considered before
making investment decisions.

103
5) RATE OF EARNING (ROE):

Return on Equity (ROE) is a key financial metric that measures the profitability
and efficiency of a company in generating profits from its shareholders' equity. In
the context of Fortis Healthcare in a specific year, ROE can be explained as
follows: In 2021, Fortis Healthcare achieved an ROE of X%. This means that for
every dollar of shareholders' equity invested in the company, it generated a return
of X cents in net profit. A higher ROE typically indicates better financial
performance and efficient use of equity capital. Fortis Healthcare's ROE was
influenced by several factors. Firstly, its net income for the year contributed to the
numerator of the ROE formula. This figure was influenced by factors such as
revenue from healthcare services, cost management, and operational efficiency.

Secondly, the denominator of the ROE formula, shareholders' equity, includes the
value of assets, liabilities, and retained earnings. Fortis Healthcare may have
increased equity through new investments, retained earnings, or reduced liabilities,
impacting the ROE.

In summary, Fortis Healthcare's 2021 ROE reflects its ability to generate profits
relative to shareholders' equity. A high ROE suggests strong financial
performance, while a lower ROE may indicate the need for improved profitability
or more efficient use of equity capital.
104
6) DEBT TO EQUITY:

The debt-equity ratio is a financial metric used to assess a company's financial

leverage by comparing its debt to its equity. In the case of Fortis Healthcare in
2003, this ratio indicated the proportion of debt and equity used to finance the
company's operations and investments. A high debt-equity ratio suggests that
Fortis Healthcare relied heavily on debt to fund its operations and growth. While
this can amplify returns during profitable periods, it also increases financial risk as
the company must meet interest payments and repay principal amounts, which can
strain cash flows, especially during economic downturns. Conversely, a low debt-
equity ratio suggests a conservative financial structure, with a greater reliance on
equity capital. This approach can offer stability and lower financial risk but may
limit growth opportunities.

To determine if Fortis Healthcare's debt-equity ratio was healthy in 2023, it's

crucial to consider the industry's norms and the company's specific circumstances.
High-quality healthcare services often require significant investments, and some
debt may be justified if it enhances long-term profitability and competitiveness.
However, excessively high debt levels could signal financial vulnerability if not
managed prudently. Therefore, an assessment of Fortis Healthcare's overall
financial health and its ability to service its debt would provide a more
comprehensive understanding of its financial position in 2023.
105
 5.2.2 TABLE AND CHART SHOWING DATA ANALYSIS OF
INCOME STATEMENT.
1) QUARTERLY INCOME STATEMENT:
Particular Jun-23 Mar-23 Dec-22 Sep-22 Jun-22

Sales 1,657 1,642 1,559 1,607 1,487

Other Income 8 13 11 15 20

Total Income 1,665 1,656 1,571 1,622 1,508

Total Expenditure 1,462 1,443 1,354 1,329 1,311

EBIT 202 213 216 293 197

Interest 31 31 33 32 31

Tax 46 45 43 49 42

Net Profit 124 136 139 210 124

Quarterly income statements are useful for monitoring a company's financial

performance on a more frequent basis than annual reports. They provide insights
into how the company is faring over shorter timeframes, which can be important
for making strategic decisions and evaluating trends.

The computation of the quarterly income statement in the above excel format
which includes from the period of 2022 to 2023. From the year jun-22 the revenue
sales was 1,487 which succeed by the same year sep-22 sales was 1,607 and in the
same way on dec-22 the sales revenue is decreased to 1,559 due to some Covid-19
effect. On the next year that is mar-23 the sale revenue has increased to 1,642 and
jun-23 also the sales have been increased up to 1,657. This shows that, if the sales
of the any company or the organization or any other business it helps in the
maintain the income statement of the company.

106
2) HALF YEARLY INCOME STATEMENT:
Particular Mar-23 Sep-22 Mar-22 Sep-21 Mar-21

Sales 3,202 3,095 2,844 2,872 2,429

Other Income 25 36 11 15 16

Total Income 3,228 3,131 2,856 2,888 2,445

Total Expenditure 2,797 2,640 2,480 2,154 2,186

EBIT 430 490 376 734 259

Interest 65 64 68 78 82

Tax 89 91 90 107 97

Net Profit 276 335 217 548 79

A half-yearly income statement, also known as a semi-annual income statement, is

a financial report that provides a summary of a company's financial performance
over a six-month period. This statement is a key component of a company's
financial reporting and is typically prepared by businesses to provide stakeholders,
including investors, creditors, and management, with an overview of their financial
results and operations halfway through the fiscal year.

The computation of the half yearly income statement in the above excel format
which includes from the period of 2021 to 2023. From the year mar-21 the revenue
sales was 2,429 which succeed by the same year sep-21 sales was 2,872 and in the
same way on mar-22 the sales revenue is decreased to 2,844 due to some expenses
effect. On the next year that is sep-22 the sale revenue has increased to 3.095 and
mar-23 also the sales have been increased up to 3,202. This shows that, if the sales
of the any company or the organization or any other business it helps in the
maintain the income statement of the company.

107
3) NINE MONTHS INCOME STATEMENT:
Particular Dec-22 Dec-21 Dec-20 Dec-19 Dec-18

Sales 4,654 4,339 2,777 3,519 3,285

Other Income 47 21 40 34 82

Total Income 4,702 4,360 2,817 3,553 3,367

Total Expenditure 3,995 3,400 2,788 3,185 3,570

EBIT 707 960 29 368 -202

Interest 97 116 125 148 272

Tax 135 158 51 97 -68

Net Profit 474 685 -147 122 -405

A nine-month income statement is used to provide stakeholders, such as investors,
creditors, and analysts, with an interim snapshot of a company's financial
performance. While it's not a full-year statement, it can be useful for assessing
trends and identifying areas of concern or areas where improvements are needed. It
can also be compared to previous nine-month periods or full fiscal years to analyze
performance over time.

The computation of the nine months income statement in the above excel format
which includes from the period of 2018 to 2022. From the year dec-18 the revenue
sales was 3,285 which succeed by the same year dec-19 sales was 3,519 and in the
same way on dec-20 the sales revenue is decreased to 2,777 due to some expenses
effect. On the next year that is dec-21 the sale revenue has increased to 4,339 and
dec-22 also the sales have been increased up to 4,654. This shows that, if the sales
of the any company or the organization or any other business it helps in the
maintain the income statement of the company.

108
4) ANNUALLY INCOME STATEMENT:
Particular Mar-23 Mar-22 Mar-21 Mar-20 Mar-19

Sales 6,297 5,717 4,030 4,632 4,469

Other Income 61 27 46 52 92

Total Income 6,359 5,744 4,076 4,684 4,561

Total Expenditure 5,438 4,634 3,915 4,252 4,699

EBIT 920 1,110 161 432 -137

Interest 129 146 165 205 336

Tax 180 197 99 147 113

Net Profit 611 765 -103 79 -588

An annual income statement, also known as an annual profit and loss statement or
annual income statement, is a financial document that provides a summary of a
company's revenues, expenses, and profits over a specific period, typically one
fiscal year. This statement is a key component of a company's financial reports and
is used by investors, analysts, and management to assess the financial performance
and profitability of the business.

The computation of the annually income statement in the above excel format
which includes from the period of 2019 to 2023. From the year mar-19 the revenue
sales was 4,469 which succeed by the same year mar-20 sales was 4,632 and in the
same way on mar-21 the sales revenue is decreased to 4,030 due to some expenses
effect. On the next year that is mar-22 the sale revenue has increased to 5,717 and
mar-23 also the sales have been increased up to 6,297. This shows that, if the sales
of the any company or the organization or any other business it helps in the
maintain the income statement of the company.

109
 5.2.3 TABLE AND CHART SHOWING BALANCE SHEET
ANALYSIS.
PARTICULAR Mar-23 Mar-22 Mar-21 Mar-20 Mar-19
LIABILITIES

Share Capital 754 754 754 754 754

Reserves & Surplus 6,485 5,423 5,362 5,902 5,822

Current Liabilities 1,425 1,269 1,233 2,578 3,590

Other Liabilities 3,767 4,437 3,803 2,111 1,783

Total Liabilities 12,433 11,884 11,154 11,347 11,951

Assets

Fixed Assets 5,513 5,485 5,242 5,285 5,205

Current Assets 1,406 1,133 1,036 940 1,666

Other Assets 5,514 5,265 4,875 5,122 5,078

Total Assets 12,433 11,884 11,154 11,347 11,951

Other Info

Contingent Liabilities 2,834 2,607 1,936 1,880 1,594

In the context of data analysis for mergers and acquisitions (M&A), a balance
sheet plays a crucial role in assessing the financial health and value of the target
company. A balance sheet is one of the three fundamental financial statements,
along with the income statement and cash flow statement. It provides a snapshot of
a company's financial position at a specific point in time, typically at the end of a
quarter or fiscal year. In M&A data analysis, the balance sheet is used to:

Asset and Liability Valuation: The balance sheet lists the assets, which include
items like cash, accounts receivable, inventory, property, and equipment, as well as
liabilities, such as accounts payable, loans, and other obligations. Analysts
examine the values and composition of these assets and liabilities to determine the
overall financial health and strength of the target company.
110
Identify Hidden Liabilities: Careful analysis of the balance sheet can reveal any
hidden or contingent liabilities, such as pending lawsuits, warranties, or pension
obligations, which can impact the financial risk and cost of acquiring the target
company.

Debt Assessment: The balance sheet provides insight into a company's debt
structure, including the type, amount, and maturity of its debt. This is critical
information for acquirers to understand the debt they may assume in the M&A
transaction.

Working Capital Analysis: Working capital is the difference between current

assets and current liabilities. Analyzing this can help acquirers understand the
company's short-term liquidity and operational efficiency.

Goodwill and Intangible Assets: The balance sheet also includes intangible
assets, such as goodwill, patents, trademarks, and other intellectual property. These
items can have a significant impact on the valuation of the target company.

Equity and Ownership Structure: The balance sheet will also show the equity
section, including common stock, retained earnings, and additional paid-in capital.
Understanding the ownership structure and equity ownership is essential for
acquirers.

Conclusion:

The balance sheet is a crucial source of financial data for M&A data analysis. It
helps potential acquirers evaluate the financial health, assets, liabilities, and overall
value of the target company. Analyzing the balance sheet, along with other
financial statements and due diligence, allows acquirers to make informed
decisions about the potential transaction and its financial implications.

111
 5.2.4 TABLE AND CHART SHOWING PROFIT AND LOSS
ANALYSIS
PROFIT & LOSS ACCOUNT OF FORTIS HEALTHCARE (in Rs. Cr.) 23-Mar 22-Mar 21-Mar 20-Mar 19-Mar
12 mths 12 mths 12 mths 12 mths 12 mths
INCOME
REVENUE FROM OPERATIONS [GROSS] 1,039.03 862.61 620.78 688.88 642.96
Less: Excise/Sevice Tax/Other Levies 0 0 0 0 0
REVENUE FROM OPERATIONS [NET] 1,039.03 862.61 620.78 688.88 642.96
TOTAL OPERATING REVENUES 1,052.93 862.61 632.87 701.85 656.49
Other Income 149.58 134.09 191.98 938.34 524.49
TOTAL REVENUE 1,202.50 996.71 824.85 1,640.19 1,180.98
EXPENSES
Cost Of Materials Consumed 0 0 0 0 0
Purchase Of Stock-In Trade 0 0 0 0 0
Operating And Direct Expenses 266.4 209.3 149.19 151.67 130.72
Changes In Inventories Of FG,WIP And Stock-In Trade -1.12 -5.01 1.39 -4.19 0.97
Employee Benefit Expenses 175.45 154.23 147.65 155.44 149.53
Finance Costs 106.24 129.58 141.45 160.17 192.27
Depreciation And Amortisation Expenses 115.88 112.63 110.77 96.81 27.14
Other Expenses 479.05 388.69 306.8 331.04 500.71
TOTAL EXPENSES 1,141.90 989.41 857.18 890.89 1,001.34
PROFIT/LOSS BEFORE EXCEPTIONAL, EXTRAORDINARY ITEMS AND TAX 60.6 7.29 -32.33 749.3 179.65
Exceptional Items 48.29 -16.28 56.46 -128.63 0
PROFIT/LOSS BEFORE TAX 108.88 -8.99 24.13 620.68 179.65
TAX EXPENSES-CONTINUED OPERATIONS
Current Tax 8.79 2.31 12.51 127.15 42.41
Less: MAT Credit Entitlement 0 0 0 0 0
Deferred Tax 3.86 1.96 7.42 -19.8 14.16
Tax For Earlier Years 0 0 0 0 0
TOTAL TAX EXPENSES 12.64 4.26 19.93 107.35 56.56
PROFIT/LOSS AFTER TAX AND BEFORE EXTRAORDINARY ITEMS 96.24 -13.25 4.2 513.33 123.08
PROFIT/LOSS FROM CONTINUING OPERATIONS 96.24 -13.25 4.2 513.33 123.08
PROFIT/LOSS FOR THE PERIOD 96.24 -13.25 4.2 513.33 123.08
OTHER ADDITIONAL INFORMATION
EARNINGS PER SHARE
Basic EPS (Rs.) 1.27 -0.18 0.06 6.8 2.02
Diluted EPS (Rs.) 1.27 -0.18 0.06 6.8 2.02
VALUE OF IMPORTED AND INDIGENIOUS RAW MATERIALS STORES, SPARES AND LOOSE TOOLS
Imported Raw Materials 0 0 0 0 0
Indigenous Raw Materials 0 0 0 0 0
STORES, SPARES AND LOOSE TOOLS
Imported Stores And Spares 0 0 0 0 0
Indigenous Stores And Spares 0 0 0 0 0
DIVIDEND AND DIVIDEND PERCENTAGE
Equity Share Dividend 0 0 0 0 0
Tax On Dividend 0 0 0 0 0
Equity Dividend Rate (%) 10 0 0 0 0

112
Profit and loss data analysis in mergers and acquisitions (M&A) is a crucial part of
the due diligence process. It involves assessing the financial performance and
health of the target company, with a specific focus on its historical and projected
profits and losses. This analysis helps the acquiring company evaluate the potential
risks and benefits of the merger or acquisition.

Here are some key aspects of profit and loss data analysis in M&A:

Historical Financial Statements: Reviewing the target company's historical

income statements, also known as profit and loss (P&L) statements, is essential.
These statements provide a detailed breakdown of the company's revenues, costs,
and expenses over a specific period (usually three to five years). Analyzing these
statements can reveal trends in profitability, identify areas of strength or weakness,
and uncover any irregularities.

Revenue Analysis: Examining revenue streams and their sources is crucial. This
analysis helps identify the company's core revenue-generating activities and assess
the stability and growth potential of these revenue streams.

Cost and Expense Analysis: A detailed breakdown of the target company's

operating costs and expenses is essential. This includes understanding the cost
structure and identifying any areas where cost reductions or operational
improvements can be made.

Profit Margins: Calculating and analyzing various profit margins, such as gross
margin, operating margin, and net margin, can provide insights into the company's
profitability and efficiency.

EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization):

EBITDA is a common financial metric used in M&A. It provides a clearer picture
of a company's operating performance by excluding non-operating expenses and
non-cash items. EBITDA is often used to determine a company's valuation.

113
Projections and Forecasts: In addition to historical data, analyzing the target
company's financial projections and forecasts is crucial. These projections may
include revenue growth, cost expectations, and potential synergies resulting from
the merger or acquisition.

Sensitivity Analysis: Conducting sensitivity analysis to understand how changes

in key assumptions can impact the target company's profit and loss statements is
essential. This helps assess the risk associated with the acquisition and determine if
the deal remains financially viable under different scenarios.

Integration Costs: Factoring in the costs of integrating the target company into
the acquiring company's operations is important. This may include one-time
expenses related to systems integration, layoffs, or other restructuring activities.

Tax Implications: Understanding the tax implications of the merger or acquisition

is crucial, as they can significantly impact the profit and loss data. Analyzing the
target company's tax structure and potential tax benefits is part of this analysis.

Conclusion:

Profit and loss data analysis in M&A is vital for making informed decisions about
whether to proceed with the transaction, determining the appropriate purchase
price, and developing a post-acquisition strategy to optimize the combined entity's
financial performance. It also assists in risk assessment and helps in negotiating the
terms of the deal. The profit and loss statement is a fundamental financial
document that provides critical insights into a company's financial performance. It
is a key tool for assessing profitability, making informed decisions, tracking
progress, and ensuring transparency and accountability. By regularly analyzing and
understanding this statement, businesses can take steps to improve their financial
performance and ultimately achieve their financial goals.

114
 5.2.5 TABLE AND CHART SHOWING CASHFLOW DATA
ANALYSIS.
PARTICULAR Mar-23 Mar-22 Mar-21 Mar-20 Mar-19

Operating Activities 822 865 485 171 -178

Investing Activities -373 -514 -135 60 -3,322

Financing Activities -471 -517 -142 -861 4,256

Others 1 13 4 3 43

Net Cash Flow -21 -152 212 -626 798

Cash flow analysis is an essential component of the due diligence process in

mergers and acquisitions (M&A). It involves the examination of a target
company's historical and projected cash flows to assess its financial health and to
determine its value. Cash flow analysis is critical because it helps acquirers
understand the target company's ability to generate cash and repay debts, which, in
turn, affects the overall financial feasibility and attractiveness of the deal.

Here are the key components and aspects of cash flow analysis in M&A:

Historical Cash Flows: Examining the historical cash flow statements of the
target company is the first step. This involves analyzing the company's cash
inflows and outflows over a specific period, usually the last three to five years.
This data helps in understanding the company's past performance and its ability to
generate cash.

Adjustments: Cash flow analysis often involves making adjustments to the

reported cash flows to account for non-recurring items or those not directly related
to the core business. Common adjustments include adding back depreciation and
amortization (as these are non-cash expenses) or accounting for one-time expenses
like restructuring costs.

115
Operating Cash Flows: The core of cash flow analysis revolves around assessing
the company's operating cash flows. These are the cash flows generated from the
company's primary business activities and are a key indicator of its financial
health.

Capital Expenditures: Understanding the company's capital expenditure (CapEx)

requirements is crucial. High CapEx can be a drain on cash flow, while low CapEx
can indicate the potential for strong free cash flow.

Working Capital Changes: Changes in working capital (e.g., accounts receivable,

inventory, accounts payable) can significantly impact cash flows. An increase in
working capital requirements can tie up cash, while a decrease can free up cash.

Debt Service: Evaluating the company's debt obligations is vital. This includes
assessing the interest payments, principal repayments, and other financial
obligations. These impact the cash available for shareholders and potential
acquirers.

Tax Considerations: Tax implications on cash flows must be considered. Changes

in tax laws or deferred tax assets and liabilities can affect future cash flows.

Scenario Analysis: Besides examining historical cash flows, M&A professionals

often perform scenario analysis to project future cash flows under various
scenarios, such as base case, best case, and worst case. This helps in assessing the
range of possible outcomes and risks.

Discounted Cash Flow (DCF) Analysis: The final step in cash flow analysis is
often to use the projected future cash flows to determine the target company's
present value. This is done through DCF analysis, which considers the time value
of money and discount rates to estimate the company's intrinsic value.

Conclusion: Cash flow analysis in mergers and acquisitions is a comprehensive

evaluation of a target company's cash flows, with the aim of understanding its
financial performance, debt obligations, and potential future cash flow prospects.
This analysis is a critical part of the due diligence process to assess the value and
feasibility of an M&A transaction.
116
 5.2.6 TABLE AND CHART SHOWING CAPITAL STRUCTURE
ANALYSIS.
Period Instrument AuthorizedIssued
Capital
Capital Paid-up
From To (Rs. cr) (Rs. cr) Shares (nos) Face ValueCapital

2022 2023 Equity Share 850 754.96 754,958,148 10 754.96

2021 2022 Equity Share 850 754.96 754,958,148 10 754.96
2020 2021 Equity Share 928 754.96 754,958,148 10 754.96
2019 2020 Equity Share 928 754.96 754,958,148 10 754.96
2018 2019 Equity Share 928 754.95 754,954,948 10 754.95
2017 2018 Equity Share 600 518.66 518,657,231 10 518.66
2016 2017 Equity Share 600 517.73 517,727,631 10 517.73
2015 2016 Equity Share 600 463.13 463,129,994 10 463.13
2014 2015 Equity Share 600 462.81 462,805,414 10 462.81
2013 2014 Equity Share 600 462.79 462,786,314 10 462.79
2012 2013 Equity Share 600 405.21 405,207,335 10 405.21
2011 2012 Equity Share 600 405.18 405,179,715 10 405.18
2010 2011 Equity Share 600 405.1 405,103,475 10 405.1
2009 2010 Equity Share 600 317.32 317,323,609 10 317.32
2008 2009 Equity Share 600 226.67 226,666,533 10 226.67
2007 2008 Equity Share 322 226.67 226,666,533 10 226.67
2006 2007 Equity Share 272 180.67 180,670,094 10 180.67
2005 2006 Equity Share 198 170 169,999,900 10 170

Capital structure in the context of mergers and acquisitions (M&A) refers to the
mix of equity and debt financing that a company utilizes to fund its operations and
growth, including the acquisition of other companies. It plays a crucial role in
M&A transactions as it can impact the financial health, risk, and overall success of
the deal.

Financing the Acquisition: When a company acquires another business, it often

needs to secure financing to cover the purchase price and related costs. The way it
structures this financing can significantly impact the deal's success. The acquirer
can use a combination of equity (e.g., issuing new shares) and debt (e.g., taking out
loans or issuing bonds) to fund the acquisition. The specific mix chosen will
depend on factors such as the buyer's financial position, the target company's
financials, and market conditions.
117
Leveraged Buyouts (LBOs): In some M&A transactions, particularly leveraged
buyouts, a significant portion of the acquisition cost is financed through debt. The
target company's assets and cash flows are often used as collateral to secure the
debt financing. This approach can increase the potential returns for the acquirer but
also comes with higher financial risk.

Debt Capacity: Assessing the acquiring company's debt capacity is crucial in

M&A transactions. It involves evaluating how much debt a company can take on
without jeopardizing its financial stability or creditworthiness. Understanding debt
capacity helps in determining the optimal mix of equity and debt for financing the
acquisition.

Capital Efficiency: The capital structure of the combined entity post-acquisition

should be designed to maximize efficiency and minimize the cost of capital. This
often involves optimizing the balance between equity and debt, which can lead to a
lower weighted average cost of capital (WACC).

Post-Merger Integration: After the acquisition is complete, managing the

combined company's capital structure is vital. This includes refinancing debt,
integrating the financial systems of both companies, and aligning capital allocation
strategies to support the new entity's growth and objectives.

Credit Ratings and Covenants: Debt financing typically comes with credit
ratings and debt covenants. In M&A, maintaining a favorable credit rating and
adhering to covenants are essential, as a downgrade in credit rating can lead to
higher borrowing costs, and breaching covenants may trigger default.

Conclusion:
Capital structure in mergers and acquisitions refers to the financing mix used to
fund the acquisition, and it has a significant impact on the financial health, risk,
and profitability of the combined entity. The choice between equity and debt
financing, as well as the post-acquisition management of capital structure, is
integral to the success of M&A transactions.

118
 5.2.7 TABLE AND CHART SHOWING RATIO ANALYSIS.
1) PER SHARE RATIO:
Particular Mar-23 Mar-22 Mar-21 Mar-20 Mar-19

Basic EPS (Rs.) 7.8 7.35 -1.45 0.77 -3.7

Diluted Eps (Rs.) 7.8 7.35 -1.45 0.77 -3.7

Book Value [Excl. Reval Reserve]/Share (Rs.) 107.3 92.83 88.98 95.44 94.21

Dividend/Share (Rs.) 1 0 0 0 0

Face Value 10 10 10 10 10
A per-share ratio, also known as a per-share metric, is a financial measure used to
evaluate a company's performance and financial health on a per-share basis. It is
calculated by dividing a specific financial or operational metric by the number of
outstanding shares of a company's stock. The purpose of expressing these metrics
on a per-share basis is to make it easier for investors and analysts to compare and
assess the company's performance relative to its stock price.

150

100
Basic EPS (Rs.)
50

0
Jan-19 Jan-20 Jan-21 Jan-22 Jan-23
Diluted Eps (Rs.)
-50

The computation of the growth ratio in the above chart which includes from the
period of 2019 to 2023. From the year mar-19 the ratio was -3.7 it means the due to
fall down of stock price. In mar-20 the ratio was positively to 0.77. In mar-21 the
ratio was little to -1.45. In mar-22 the ratio was 7.35 price was mostly increased. In
mar-23 the ratio was 7.8 means the per-share ratio of the Fortis has been
continuously increased from the previous year that is from 2022-2023.

119
2) MARGIN RATIOS:
Particular Mar-23 Mar-22 Mar-21 Mar-20 Mar-19

Gross Profit Margin (%) 18.46 19.17 11.19 14.29 7.1

Operating Margin (%) 13.45 13.91 3.98 7.99 1.89

Net Profit Margin (%) 9.7 13.39 -2.57 1.71 -13.15

Margin ratio typically refers to the proportion of margin or collateral required for a
financial transaction, such as trading stocks, commodities, or options. It is
expressed as a percentage and represents the amount of funds or assets you need to
have in your trading account relative to the total value of the position you want to
open. The margin ratio is an important concept in leveraged trading, as it
determines how much leverage you can use in your trading activities.

25
20
15
Gross Profit Margin (%)
10
5
Operating Margin (%)
0
-5 Jan-19 Jan-20 Jan-21 Jan-22 Jan-23

-10 Net Profit Margin (%)

-15

The computation of the margin ratio in the above chart which includes from the
period of 2019 to 2023. From the year mar-19 the ratio was -4.87 it means the
negative ratio due to fall down of stock price. In mar-20 the ratio was positively
increased to 8.21. In mar-21 the ratio was little decreased negatively to -1.29. In
mar-22 the ratio was 10.87 price was mostly increased. In mar-23 the ratio was
12.47 means the margin ratio of the Fortis has been continuously increased from
the previous year that is from 2022-2023.

120
3) RETURN RATIOS:
Particular Mar-23 Mar-22 Mar-21 Mar-20 Mar-19

Return on Networth / Equity (%) 8.12 8.98 -1.79 0.86 -4.52

ROCE (%) 7.69 7.49 1.61 4.22 1.01

Return On Assets (%) 4.73 4.67 -0.98 0.51 -2.5

Return ratios are financial metrics used to evaluate the profitability and efficiency
of a company or investment. These ratios provide insight into how well a company
is generating returns or profits relative to its resources, assets, or investments.
These return ratios are essential tools for investors, analysts, and management to
assess a company's financial performance and compare it to industry benchmarks.
Different industries and investment opportunities may prioritize specific return
ratios depending on their unique characteristics and financial goals.

10
8
6 Return on Networth / Equity
(%)
4
2
0
ROCE (%)
Jan-19 Jan-20 Jan-21 Jan-22 Jan-23
-2
-4
-6

The computation of the return ratio in the above chart which includes from the
period of 2019 to 2023. From the year mar-19 the ratio was -4.53 it means the
negative ratio due to fall down of stock price. In mar-20 the ratio was positively to
0.87. In mar-21 the ratio was little decreased negatively to -1.79. In mar-22 the
ratio was 8.99 price was mostly increased. In mar-23 the ratio was 8.44 means the
return ratio of the Fortis has been continuously increased from the previous year
that is from 2022-2023.

121
4) LIQUIDITY RATIOS:
Particular Mar-23 Mar-22 Mar-21 Mar-20 Mar-19

Current Ratio (X) 0.99 0.89 0.84 0.36 0.46

Quick Ratio (X) 0.9 0.8 0.78 0.33 0.45

Liquidity ratios are financial metrics that assess a company's ability to meet its
short-term financial obligations or its ability to convert its assets into cash quickly.
These ratios are essential for evaluating a company's short-term financial health
and its capacity to cover immediate expenses, such as bills, debts, and operational
costs. A high liquidity ratio suggests that a company is in a better position to cover
its short-term liabilities, which can be reassuring for investors and creditors.
However, an excessively high ratio might indicate that the company is not
efficiently using its assets. It's important to analyze these ratios in the context of
the company's operations and financial goals.

1.2

0.8

0.6 Current Ratio (X)

0.4
Quick Ratio (X)
0.2

0
Jan-19 Jan-20 Jan-21 Jan-22 Jan-23

The computation of the liquidity ratio in the above chart which includes from the
period of 2019 to 2023. From the year mar-19 the ratio was 0.464 it means the due
to fall down of stock price. In mar-20 the ratio was positively to 0.365. In mar-21
the ratio was little to 0.841. In mar-22 the ratio was 0.893 price was mostly
increased. In mar-23 the ratio was 1.46 means the liquidity ratio of the Fortis has
been continuously increased from the previous year that is from 2022-2023.

122
5) LEVERAGE RATIOS:
Particular Mar-23 Mar-22 Mar-21 Mar-20 Mar-19

Debt to Equity (x) 0.1 0.16 0.19 0.2 0.28

Interest Coverage Ratios (X) 9.01 7.47 0.97 1.81 0.25

Leverage ratios are financial metrics that measure the extent to which a company
uses debt or leverage in its capital structure to finance its operations and
investments. These ratios are important for assessing a company's financial risk,
solvency, and its ability to meet its financial obligations. Leverage ratios are
essential tools for investors, creditors, and analysts to assess the financial health
and risk profile of a company. Companies with excessive leverage may face higher
financial risk, especially in economic downturns, while those with lower leverage
ratios may be considered more financially stable. The appropriate level of leverage
depends on a company's industry, business model, and risk tolerance.

10

6
Debt to Equity (x)
4

2 Interest Coverage Ratios (X)

0
Jan-19 Jan-20 Jan-21 Jan-22 Jan-23

The computation of the leverage ratio in the above chart which includes from the
period of 2019 to 2023. From the year mar-19 the ratio was 0.57 it means the due
to fall down of stock price. In mar-20 the ratio was positively to 0.68. In mar-21
the ratio was little to 0.84. In mar-22 the ratio was 0.89 price was mostly increased.
In mar-23 the ratio was 1.76 means the leverage ratio of the Fortis has been
continuously increased from the previous year that is from 2022-2023.

123
6) TURNOVER RATIO:
Particular Mar-23 Mar-22 Mar-21 Mar-20 Mar-19

Asset Turnover Ratio (%) 0.09 0.08 36.12 40.82 37.39

Inventory Turnover Ratio (X) 0 0 52.5 59.25 79.06

Turnover ratios are financial metrics used to measure the efficiency and
effectiveness of a company's operations, specifically in managing its assets,
liabilities, or overall business activities. They are important indicators of a
company's ability to generate revenue or manage its resources effectively. These
turnover ratios help analysts and investors assess a company's financial health and
efficiency in different aspects of its operations. They can also be used to make
comparisons between companies in the same industry or track a company's
performance over time. Keep in mind that the ideal turnover ratio varies by
industry and should be interpreted in the context of the specific business and its
strategy.

90
80
70
60
50 Asset Turnover Ratio (%)
40
30
20 Inventory Turnover Ratio (X)
10
0
Jan-19 Jan-20 Jan-21 Jan-22 Jan-23

The computation of the turnover ratio in the above chart which includes from the
period of 2019 to 2023. From the year mar-19 the ratio was 43.45 it means the due
to fall down of stock price. In mar-20 the ratio was positively to 39.76. In mar-21
the ratio was little to 35.82. In mar-22 the ratio was 49.63 price was mostly
increased. In mar-23 the ratio was 51.79 means the turnover ratio of the Fortis has
been continuously increased from the previous year that is from 2022-2023.

124
7) GROWTH RATIOS:
Particular Mar-23 Mar-22 Mar-21 Mar-20 Mar-19

3 Yr CAGR Sales (%) 16.6 13.11 -6 0.64 3.17

3 Yr CAGR Net Profit (%) 177.58 14.11 -67.59 242.29 323.71

Growth ratios are financial metrics used to assess the rate at which a specific
financial variable is increasing or decreasing over a period of time. These ratios are
commonly used in financial analysis to evaluate the growth and performance of a
business, investment, or economic indicator. These growth ratios are essential for
investors, analysts, and decision-makers to assess the financial health and
performance of a company, make investment decisions, and understand economic
trends. A high growth rate may indicate a company's success and potential
investment opportunity, while a declining rate may signal challenges that need to
be addressed. It's important to consider these ratios in conjunction with other
financial metrics and the broader economic context for a comprehensive analysis

350
300
250
200
150 3 Yr CAGR Sales (%)
100
50 3 Yr CAGR Net Profit (%)
0
-50 Jan-19 Jan-20 Jan-21 Jan-22 Jan-23
-100
.

The computation of the growth ratio in the above chart which includes from the
period of 2019 to 2023. From the year mar-19 the ratio was 4469.36 it means the
due to fall down of stock price. In mar-20 the ratio was positively to 4632.32. In
mar-21 the ratio was little to 4030.12. In mar-22 the ratio was 5171.61 price was
mostly increased. In mar-23 the ratio was 6297.63 means the growth ratio of the
Fortis has been continuously increased from the previous year that is from 2022-
2023.
125
8) VALUATION RATIOS:
Particular Mar-23 Mar-22 Mar-21 Mar-20 Mar-19

P/E (x) 33.32 39.51 -137.34 163.83 -36.69

P/B (x) 2.71 3.55 2.45 1.43 1.55

EV/EBITDA (x) 17.9 21.26 36.26 16.78 37.08

P/S (x) 3.12 3.83 3.73 2.05 2.29

Valuation ratios are financial metrics used by investors and analysts to assess the
relative value of a company's stock or other financial assets. These ratios provide
insights into whether a particular asset is overvalued, undervalued, or fairly priced
in the financial markets. Valuation ratios are essential tools for making investment
decisions and are commonly used in fundamental analysis. Valuation ratios are just
one part of a comprehensive financial analysis, and they should be considered
alongside other factors such as a company's growth prospects, industry trends, and
overall financial health.

200

100 P/E (x)

0
Jan-19 Jan-20 Jan-21 Jan-22 Jan-23 P/B (x)
-100
EV/EBITDA (x)
-200

The computation of the growth ratio in the above chart which includes from the
period of 2019 to 2023. From the year mar-19 the ratio was -36.69 it means the due
to fall down of stock price. In mar-20 the ratio was positively to 163.83. In mar-21
the ratio was little to -137.34. In mar-22 the ratio was 39.51 price was mostly
increased. In mar-23 the ratio was 33.32 means the growth ratio of the Fortis has
been continuously increased from the previous year that is from 2022-2023.

126
 5.2.8 TABLE AND CHART SHOWING CHANGE IN WORKING
CAPITAL ANALYSIS.

The latest Working Capital ratio of FORTIS HEALTHCARE is -38.57 based on Mar2023 Consolidated results.

Year Working Capital

Mar-23 -38.57
Mar-22 -41.49
Mar-21 -20.3
Mar-20 -2.83
Mar-19 -2.32

Change in working capital, often referred to as "delta working capital," is a

financial metric that represents the difference between a company's current assets
and its current liabilities. Current assets are those assets that are expected to be
converted into cash or used up within one year, while current liabilities are debts
and obligations that are due within the same period.

Change in Working Capital = Current Assets - Current Liabilities

Working Capital
Mar-23
Mar-22
Mar-21
Mar-20
Mar-19

The computation of the changes in working capital in the above chart which
includes from the period of 2019 to 2023. From the year mar-19 the ratio was -2.32
it means the due to fall down of stock price. In mar-20 the ratio was negatively to -
2.83. In mar-21 the ratio was little to -20.3. In mar-22 the ratio was -41.49 price
was negatively increased. In mar-23 the ratio was -38.57 means the change in
working capital of the Fortis has been continuously negatively decreased from the
previous year that is from 2022-2023.
127
 5.2.9 TABLE AND CHART SHOWING TREND ANALYSIS OF
SALES.
The latest Trend Sales analysis ratio of FORTIS HEALTHCARE is 10.14 based on Mar2023 Consolidated results.

Year Trend sales

Mar-23 10.14
Mar-22 41.87
Mar-21 -13
Mar-20 3.65
Mar-19 -2.01

Trend analysis of sales is a method used by businesses to examine historical sales

data and identify patterns, trends, and insights that can help inform future sales
strategies and decision-making. This analysis involves the systematic examination
of sales data over a period of time, typically with the aim of understanding how
sales have evolved, what factors have influenced those changes, and what the
future sales trajectory might look like and adapt to changing market conditions.

Trend sales

Mar-23
Mar-22
Mar-21
Mar-20
Mar-19

The computation of the Trend analysis of sales in the above chart which includes
from the period of 2019 to 2023. From the year mar-19 the ratio was -2.01 it means
the due to fall down of stock price. In mar-20 the ratio was positive to 3.65. In
mar-21 the ratio was little to -13. In mar-22 the ratio was 41.87 price was
increased. In mar-23 the ratio was 10.14 means the change in working capital of
the Fortis has been continuously increased and decreased from the previous year
that is from 2022-2023.
128
 5.3 TECHNOLOGY AND HIERARCHY USED IN DATA
ANALYSIS.
1) TECHNOLOGY USED IN DATA ANALYSIS:

Data analysis is a broad field that involves examining, cleaning, transforming, and
interpreting data to extract useful insights and make informed decisions. Various
technologies and tools are commonly used in data analysis, depending on the
specific tasks and objectives. The choice of technology and tools depends on the
specific requirements of a data analysis project, including the size of the data, the
complexity of the analysis, and the skills and preferences of the data analysts. Here
are some of the key technologies and tools used in data analysis:

Modern Technology Trends in Data Analytics

a) Predictive analytics will become the norms: As the data analytics market
matures, enterprises will stop using data analytics as a way to review the
past. They will leverage their big data to predict the future. And it might not
be as far as you think! Across industries, predictive analysis is already in
action, banks, hospitals, and financial institutions are developing analytics
solution to predict and manage risk across loans, credit cards, insurance
premium etc. Marketers are performing data analysis to show the right
advertisement to the right audiences at the right place and time. Even today,
most organization use data analysis to analyze the past and human
intelligence to forecast the future.

129
b) Augmented data management and analysis: One of the biggest problems with
big data today is the unshakeable need for a data scientist to cleanse and prepare
the data before making sense of it by building analytics and dashboards. Even with
a highly-skilled data scientist, there is only so much that can be manually done,
significantly restricting the capabilities of data analytics. It is here that augmented
data analytics is steadily gaining ground. Where platforms will understand what
insight might be relevant to the user and present it proactively. Who says bots can’t
read your mind!

c) Conversational analysis: Communication has already moved beyond text —

memes are becoming legit forms of interaction and emojis are everywhere. The
next step in the evolution of online communication is bound to be in sound and
video. As voice-enabled personal assistants grow in popularity, and by extension,
this will have a great impact on how content is made accessible as a whole. By
2023, natural language processing and conversational analytics will boost business
intelligences adoption, but this corresponding prediction is a lot more relevant to
data science professional and aspirants.

d) IOT + Analysis: The internet of things (IOT) was a big trend a couple of years
ago, but it didn’t actually live up to the hype — turns out speaking refrigerators
and connected washing machines don’t yet have the market they were predicted to
have. But in the industrial markets, IOT has been a big hit. Across the
manufacturing and supply chain, IOT is making a real impact. A digital twin is the
virtual replica of physical devices. Data scientists and then use this replica for
simulations — based on which they not only innovate and improve IOT devices
but also predict future performance and make them more secure.

e) Block chain Analysis: If there is one thing that bugs data scientists the most,
it’s dirty data — data that is unclear, duplicated, erroneous, etc. Professionals are
bringing block chain to address precisely this problem. Block chain’s decentralized
consensus algorithms will be used in data validation, making it cleaner, more
usable, and therefore insights more reliable. Moreover, the decentralized system,
coupled with cryptography, will also make data secure and protect privacy. You
need mentor-led project-driven online learning programs that come with a job.
130
2) Hierarchy used in data analysis:

AI Optimize and Predict: This is the foundation of data analysis. Data is

collected from various sources, such as databases, surveys, sensors, websites, and
more. It's crucial to ensure that the data is accurate, relevant, and clean. Data
collection can involve structured data or unstructured data. Once you have clean
data, tracked across the user funnel, and analyzed for rudimentary trends drivers,
only then look to apply advances techniques like machine learning. Also consider
optimizing the top areas of opportunity in your funnel with A/B testing.

Analyze: To analyze means to examine something in detail, typically to

understand it better, identify patterns, relationships, or insights, or to draw
conclusions based on the information gathered. Analysis often involves breaking
down a complex topic or data into smaller components, studying those
components, and then drawing conclusions or making judgments based on the
findings. Evaluate your metrics against internal benchmarks, external benchmarks,
and you gut: what are the biggest areas of opportunity in your product funnel?

131
Define and Track: "define" is about clarifying the purpose and scope of your data
analysis, while "track" involves the practical steps of gathering, cleaning, and
preparing the data for analysis. These two steps are essential in the data analysis
process, as they help you ensure that your analysis is well-structured and based on
reliable and relevant data. You need to outline your objectives, identify the key
variables or factors that are relevant to your analysis, and determine the scope of
your analysis. During the tracking phase, you identify relevant data sources, extract
or collect the data, and ensure its quality and accuracy. This often involves dealing
with missing data, outliers, and data inconsistencies.

Clean: In data analysis, "clean" refers to the process of preparing and refining data
to ensure that it is accurate, consistent, and free from errors or inconsistencies.
Data cleaning is a crucial step in the data analysis process because the quality of
the data you use directly impacts the quality and validity of your analysis and any
subsequent decisions or insights derived from it. The goal of data cleaning is to
ensure that the dataset is as accurate and reliable as possible, which in turn
improves the quality and trustworthiness of any insights or conclusions drawn from
the data. Data cleaning is typically an iterative process, and it may require domain
expertise to make informed decisions about how to handle specific issues within
the data.

Collect: In data analysis, "collect" refers to the process of gathering, acquiring, and
assembling data from various sources for the purpose of examination and analysis.
This is typically one of the initial steps in the data analysis workflow. Data
collection involves obtaining relevant information or datasets that are necessary to
answer specific research questions, make informed decisions, or gain insights into
a particular problem or domain. Once the data is collected, it often needs to be
cleaned, organized, and prepared for analysis. This involves tasks like removing
missing or inconsistent data, encoding categorical variables, and structuring the
data in a way that is suitable for statistical or machine learning techniques.
Effective data collection is critical to ensuring the quality and reliability of the
analysis and the insights that can be derived from it. It's important to plan and
execute data collection carefully to minimize biases and errors that may affect the
results of the analysis.
132
 CHAPTER-6
SUMMARY OF FINDING, CONCLUSION, AND
SUGGESTION.
6.1 SUMMARY OF FINDING.
A "summary of findings" typically refers to a concise presentation of the key
results and conclusions from a research study, report, or investigation. It serves as
a way to communicate the most important information to an audience in a clear
and understandable manner. The specific content and structure of a summary of
findings can vary depending on the type of research and the intended audience. It is
essential to keep the summary concise and focused on the most critical aspects of
the research to effectively communicate the results to the reader or audience.
Here's a general outline of what a summary of findings might include:

a) In FY22, Fortis Healthcare's current liabilities increased by 3% to Rs 13 billion,

while long-term debt decreased by 19.5% to Rs 8 billion.

b) In Q3FY23, Fortis Healthcare reported a flat net profit of Rs 142 crore, which
was impacted by a drop in Covid testing volumes.

c) As of March 31, 2023, Fortis Healthcare's total debt (including lease liabilities)
was reduced to Rs 926 crore from Rs 1,255 crore the previous fiscal.

f) Fortis Healthcare believes in continuous improvement and invests in methods

that can help them enhance the brand and its services.

g) Fortis Healthcare has launched legal proceedings and filed a complaint with the
Economic Offences Wing (EOW) against erstwhile promoters and their related
entities.

h) Fortis Healthcare operates a chain of hospitals and clinics in India and a few
other countries. They offer services in various medical specialties, including
cardiology, oncology, orthopedics, and more.

133
i) Fortis Healthcare was considered one of the leading players in the Indian
healthcare sector. It was known for its quality medical care and modern facilities.

j) In the years leading up to 2021, Fortis Healthcare faced financial challenges,

including debt and ownership disputes. These issues had some impact on the
company's operations and reputation.

k) There were changes in the ownership and management of Fortis Healthcare

during this period as various groups vied for control of the company.

l) COVID-19 Response like many healthcare providers, Fortis Healthcare was

actively involved in the response to the COVID-19 pandemic. They provided
treatment and testing facilities for COVID-19 patients.

m) Companies in the healthcare sector often undergo changes such as mergers,

acquisitions, partnerships, or divestitures. These events can significantly impact the
company's standing and operations.

n) Changes in healthcare regulations and policies can affect the operations and
profitability of healthcare companies.

Conclusion:

The summary of findings, it is essential to highlight the key takeaways and insights
derived from the research or analysis. This section should succinctly restate the
most important results and their implications. In September 2021, Fortis
Healthcare is a prominent healthcare company in India. It operates a network of
hospitals and clinics, providing a wide range of medical services. If you are
looking for current information on the Fortis Healthcare sector, I recommend
checking the latest news, financial reports, and other reliable sources as my
information might be outdated. The summary of findings with a strong and concise
statement that leaves a lasting impression on the reader. This could be a call to
action, a reflection on the research process, or a statement of the broader
importance of the study. Findings are significant or relevant in the larger context of
the subject matter. What does this contribute to the existing body of knowledge?

134
 6.2 MY LEARNING EXPERIENCE IN FORTIS
HOSPITAL.
About what I learnt in this Internship Training:

Fortis is a well-known healthcare organization with a presence in several countries,

including India. If you're interested in pursuing a career or learning more about the
healthcare sector at Fortis, there are various areas and skills you can focus on.
Fortis Healthcare has educational programs that focus on developing clinical skills
for good medical practice. Fortis also has a Hospital Experience Program that aims
to help non-medical employees understand how hospitals operate and the
challenges of providing high-quality healthcare.

During my internship I was introduced to the following departments at Fortis

hospital, Richmond Road, Bangalore.

That is Finance & accounts department, admission and billing department, supply
chain & procurement department, IT department, sales & marketing department,
HR department support service wherein I learnt how to collect data, observe Bills.
For all the transactions related to business, Fortis hospital manages these
transactions with Care 21 ERP.

It helped me to know the overall functioning of departments in the organization.

How the employees are motivated & trained in the organization towards achieving
their goals set by the organization. This was helped me to know the co-ordination
between the different levels in the organizations, and also helped me to know the
leadership skills and also to be as an initiator during the different situation. It gives
me a practical exposure to the various functional areas of which I only had a
theoretical knowledge so far.

I got a comprehensive understanding of all functional departments in a hospital and

provide best experience to all patient and all who are part of Fortis community.

135
Indeed! It was a great experience to learn in such a remarkable organization. Every
day was filled with excitement and a lots of learning. Subjects were realistic and
were on context, the following sector and their respect concerns contributed for my
learning. They are as follows:

Cash management.

Cash collection.

Supply chain management.

Purchase department (understanding the purchase orders).

Process to receive the goods.

IP cash billing.

Discharge process.

Basic knowledge on oracle and HIS software.

Revenue report.

Quality control department.

BRS report.

How to maintain petty cash book.

Insurance help desk in insurance department, claim process.

Lastly, being grateful for the opportunity provided by the HR Bharthi, and my
learning and training given by Finance department members Mr. Bharath
Someshkar, and Mr. Dayanand.P. and lifetime learning in Fortis La Femma
Bangalore. Under the experienced minds.

Thanks,

Unit Finance Controller , Fortis La Femma, Bangalore:

Amit Jain.
136
 6.3 CONCLUSION.
I conclude that it can be seen the deploying IT can help the medical profession in
improving it quality and services and thus automatically increasing the
preparedness and defensiveness. Of course, it isof vital importance that the
software must have right type of modularity and openness so that it is manageable,
maintain and upgradeable. The hardware should also be reliable, available and
have the necessary performance capacity.

Certainly, computers with their intrinsic power can play a major role in the
hospital. Computers can act as a communication links between departments and
allow the common database to be shared by them. They can perform the complex
task of matching, tabulating, calculating, retrieving, printing, and securing the data
required. Well designed, integrated computer system can be great tool in the hands
of the hospital management in improving services, controlling cost, and ensure
optimal utilization of facilities. This could include aspects like Fortis' financial
performance, its role in the healthcare industry, the quality of its services, market
trends, and challenges it faces. Fortis' strengths and what sets it apart in the
healthcare sector. This might include its reputation for quality care, advanced
medical technology, a wide network of hospitals, or its financial stability.

These could be issues like increased competition, regulatory challenges, or issues

with patient satisfaction or service quality. Consider the broader trends in the
healthcare sector and how Fortis has adapted or plans to adapt to these trends. This
might involve discussions about telemedicine, the impact of technology, and
changes in healthcare policies. Offer insights into the future prospects for Fortis in
the healthcare sector. Discuss potential growth opportunities, expansion plans, and
strategies to overcome challenges. Be sure to consider how external factors such as
changes in healthcare policies, demographics, and emerging technologies may
affect Fortis. Healthcare organizations, including Fortis, often emphasize corporate
responsibility and ethical practices. Discuss Fortis's stance on these matters and
how it contributes to the broader healthcare community. Fortis's approach to
patient care. Highlight the importance of putting patients at the center of healthcare
services, ensuring their safety, satisfaction, and well-being.
137
Provide your overall assessment of Fortis' position in the healthcare sector. Is it a
strong player? Does it face significant challenges? What opportunities lie ahead? If
applicable, you can suggest recommendations for Fortis to strengthen its position
or address its weaknesses. These could include strategic initiatives, cost-saving
measures, or steps to enhance patient care. Conclude with your final thoughts on
Fortis in the healthcare sector. You can express optimism about its future, raise
concerns, or simply emphasize the importance of continuous improvement in the
healthcare industry. Remember to keep your conclusion concise and to the point,
and make sure it reflects the content of your analysis. The conclusion should leave
the reader with a clear understanding of Fortis' current standing and its potential in
the healthcare sector. Briefly mention what you foresee for Fortis Healthcare in the
near and distant future. This could include expansion plans, innovation initiatives,
or other strategic considerations.

The study has revealed that Fortis Healthcare Ltd (FHL) is a developed Hospital.
When I visited Fortis , I got a very good co-operation from all the employees at
Fortis During my organizational study and mainly I felt so happy by seeing skilled
employees working in the Organization and their dedication towards the work was
really appreciable.

Every organization makes sure that its employees are satisfied and are happy
working in the organization. Every working person expects some benefits from its
organization apart from the basic salary paid to him for his work. An employee
tends to be more satisfied from the additional benefits that he obtains from the
organization. Fortis is one of those organizations who provide benefits to its
employees and they are satisfied in the Fortis Healthcare Ltd organization.

138
 6.4 SUGGESTION TO THE ORGANISATION.
We can provide some general suggestions for the future development of Fortis
Healthcare Ltd or any healthcare organization. Please note that the specific
strategies and recommendations may vary depending on the organization's current
situation, market dynamics, and regulatory environment. It's important for Fortis
Healthcare to conduct a thorough analysis of its internal and external factors before
making strategic decisions. Here are some general suggestions:

Quality Patient Care: Prioritize the delivery of high-quality patient care by

continually improving medical services, adopting the latest technologies and
treatments, and ensuring patient safety and satisfaction.

Invest in Technology: Keep up with technological advancements in healthcare,

such as electronic health records (EHRs), telemedicine, and data analytics to
improve patient outcomes and operational efficiency.

Expansion and Diversification: Explore opportunities for expanding into new

geographic regions and diversifying healthcare services. This may include offering
specialized clinics, home healthcare services, or wellness programs.

Strategic Partnerships: Collaborate with other healthcare providers,

pharmaceutical companies, and insurers to create integrated and cost-effective
healthcare solutions. This can also help in improving access to specialized
treatments and services.

Talent Acquisition and Retention: Attract and retain top talent in the healthcare
industry. Invest in staff training and development to ensure the best care and
operational excellence.

Decentralizing public health services: Decentralization of financial resources has

increased the efficiency of health care. Major policy decisions on decentralizing
human resource management, increasing budgetary allocation, and increasing
community participation in decision-making are needed. In India, in the mid-
1990s, the trend of decentralization of health care began to take shape.
139
 In 1999, systemic changes in all of the Indian states called for the transfer of
administrative and financial duties for the management of healthcare facilities to
the district level. Some of these measures were eventually included in the National
Rural Health Mission (NRHM), which was started in 2005.

Some healthcare schemes in India:

RMNCH+A ( Reproductive, Maternal, Newborn, Child, and Adolescent
health): Initiative aims to address the leading cause of death in women and
children, as well as delays in obtaining and using healthcare and services.

The Rashtriya Bal Swasthya Karyakram (RBSK): Is a big undertaking aimed

towards early detection and intervention for kids from a new child to 18 years,
protecting the four “D’s”, beginning defects, deficiencies, diseases, and
developmental delays, together with disability. Early identification and care of
disorders, such as deficiencies, ads benefits to preventing these conditions from
processing to a more severe and debilitating stage.

Janani Shishu Suraksha Karyakram (JSSK): The Indian government has

launched to encourage people who still prefer home birth to choose institutional
births. It is a program with the expectation that the state would step forward and
ensure that every poor pregnant woman visiting a government institution receives
benefits under the JSSK.

Revised National Tuberculosis Control Program (RNTCP): The government of

India was launched in 1997, is a state-run tuberculosis control effort with the goal
of making India TB-free. Through the government health system, the program
delivers numerous free, high quality TB diagnosis and treatment services across
the country.

Pulse Polio (PP): Is a immunization program launched by the Indian government

in 1995, to eradicate polio in the country by immunizing all children under the age
of 5 years against the poliovirus.

140
 CHAPTER-7
REFERENCE AND BIBLIOGRAPHY.
^ "Fortis Healthcare appoints Ashutosh Raghuvanshi as CEO". The Economic
Times. economictimes.indiatimes.com. Retrieved 7 February 2019.

^ Jump up to:a b c d "Fortis Healthcare Ltd. Financial

Statements". moneycontrol.com.

^ "Fortis Escorts".

^ "Fortis Hospital Gurgaon has 1000 beds". docprime. Retrieved 14

November 2019.

^ "Fortis Memorial Research Institute bags recognition as smart

hospital". www.biospectrumindia.com. Retrieved 16 March 2022.

^ Newsweek (2 March 2022). "World's Best Hospitals 2022 - India". Newsweek.

Retrieved 16 March 2022.

^ "Fortis Healthcare – About Us".

^ "FORTIS HEALTHCARE LIMITED - Company, directors and contact details |

Zauba Corp".

^ "IHH Healthcare completes Fortis deal by acquiring 31% stake". Live Mint. 14
November 2018.

^ "Fortis Hospital Noida". Full Details Information. 26 March 2019.

^ "Fortis Healthcare Ltd". Business Standard India.

^ Sen, Amiti (28 March 2018). "Manipal Hospitals buys Fortis hospitals
biz". @businessline.

^ "TPG-backed Manipal acquires Fortis Health, SRL Diagnostics – Times of India

►". The Times of India. 28 March 2018.
141
^ "Fortis completes acquisition of RHT assets at enterprise value of Rs 4650
crore". Medical Dialogues. 17 January 2019.

^ "Fortis Hospital Gurgaon". Full Details Information. 25 March 2019.

^ "Fortis Healthcare reports profit of Rs 78 crore for June quarter". Medical

Dialogues. 7 August 2019.

^ nagamanigrandhi (30 August 2023). "Fortis Healthcare acquires Medeor Hospital

in India for $27.23m". Hospital Management. Retrieved 30 August 2023.

Soundarya, M. Baby, S. Moghana Lavanya, and S. Hemalatha. "Merger and

Acquisition of Business Organization and Its Impact on Human
Resources." Journal of Business Strategy Finance and Management 1 and 2, no. 1
and 2 (December 28, 2019): 69–72. http://dx.doi.org/10.12944/jbsfm.01.0102.07.

Brews, P. "Corporate growth through mergers and acquisitions: Viable strategy or

road to ruin?" South African Journal of Business Management 18, no. 1 (March 31,
1987): 10–20. http://dx.doi.org/10.4102/sajbm.v18i1.992.

Gu, Yue, Shenglin Ben, and Jiamin Lv. "Peer Effect in Merger and Acquisition
Activities and Its Impact on Corporate Sustainable Development: Evidence from
China." Sustainability 14, no. 7 (March 25, 2022): 3891.
http://dx.doi.org/10.3390/su14073891.

Szezepaniak, Angelika Kedzierska. "Mergers and Acquisitions in CEE

Countries." Review of Business and Legal Sciences, no. 14 (July 19, 2017): 7.
http://dx.doi.org/10.26537/rebules.v0i14.918.

Saroj, Nikhil Gayaprasad, and Dr Kartikey V. Koti. "History and Growth of

Merger and Acquisition." International Journal of Teaching, Learning and
Education 2, no. 4 (2023): 15–20. http://dx.doi.org/10.22161/ijtle.2.4.3.

Ben Letaifa, Wissal. "Mergers and acquisitions: A synthesis of theories and

directions for future research." Risk Governance and Control: Financial Markets
and Institutions 7, no. 1 (2017): 71–74. http://dx.doi.org/10.22495/rgcv7i1art9.

142
 CHAPTER-8
ANNEXURE.
Balance Sheet for the year ended 31-3-2022.
Mar-
PARTICULAR Mar-23 Mar-22 Mar-21 Mar-20 19
LIABILITIES

Share Capital 754 754 754 754 754

Reserves & Surplus 6,485 5,423 5,362 5,902 5,822

Current Liabilities 1,425 1,269 1,233 2,578 3,590

Other Liabilities 3,767 4,437 3,803 2,111 1,783

Total Liabilities 12,433 11,884 11,154 11,347 11,951

Assets

Fixed Assets 5,513 5,485 5,242 5,285 5,205

Current Assets 1,406 1,133 1,036 940 1,666

Other Assets 5,514 5,265 4,875 5,122 5,078

Total Assets 12,433 11,884 11,154 11,347 11,951

Other Info

Contingent Liabilities 2,834 2,607 1,936 1,880 1,594

143
Profit and loss Account for the year ended 31-3-2022.
PROFIT & LOSS ACCOUNT OF FORTIS HEALTHCARE (in Rs. Cr.) 23-Mar 22-Mar 21-Mar 20-Mar 19-Mar
12 mths 12 mths 12 mths 12 mths 12 mths
INCOME
REVENUE FROM OPERATIONS [GROSS] 1,039.03 862.61 620.78 688.88 642.96
Less: Excise/Sevice Tax/Other Levies 0 0 0 0 0
REVENUE FROM OPERATIONS [NET] 1,039.03 862.61 620.78 688.88 642.96
TOTAL OPERATING REVENUES 1,052.93 862.61 632.87 701.85 656.49
Other Income 149.58 134.09 191.98 938.34 524.49
TOTAL REVENUE 1,202.50 996.71 824.85 1,640.19 1,180.98
EXPENSES
Cost Of Materials Consumed 0 0 0 0 0
Purchase Of Stock-In Trade 0 0 0 0 0
Operating And Direct Expenses 266.4 209.3 149.19 151.67 130.72
Changes In Inventories Of FG,WIP And Stock-In Trade -1.12 -5.01 1.39 -4.19 0.97
Employee Benefit Expenses 175.45 154.23 147.65 155.44 149.53
Finance Costs 106.24 129.58 141.45 160.17 192.27
Depreciation And Amortisation Expenses 115.88 112.63 110.77 96.81 27.14
Other Expenses 479.05 388.69 306.8 331.04 500.71
TOTAL EXPENSES 1,141.90 989.41 857.18 890.89 1,001.34
PROFIT/LOSS BEFORE EXCEPTIONAL, EXTRAORDINARY ITEMS AND TAX 60.6 7.29 -32.33 749.3 179.65
Exceptional Items 48.29 -16.28 56.46 -128.63 0
PROFIT/LOSS BEFORE TAX 108.88 -8.99 24.13 620.68 179.65
TAX EXPENSES-CONTINUED OPERATIONS
Current Tax 8.79 2.31 12.51 127.15 42.41
Less: MAT Credit Entitlement 0 0 0 0 0
Deferred Tax 3.86 1.96 7.42 -19.8 14.16
Tax For Earlier Years 0 0 0 0 0
TOTAL TAX EXPENSES 12.64 4.26 19.93 107.35 56.56
PROFIT/LOSS AFTER TAX AND BEFORE EXTRAORDINARY ITEMS 96.24 -13.25 4.2 513.33 123.08
PROFIT/LOSS FROM CONTINUING OPERATIONS 96.24 -13.25 4.2 513.33 123.08
PROFIT/LOSS FOR THE PERIOD 96.24 -13.25 4.2 513.33 123.08
OTHER ADDITIONAL INFORMATION
EARNINGS PER SHARE
Basic EPS (Rs.) 1.27 -0.18 0.06 6.8 2.02
Diluted EPS (Rs.) 1.27 -0.18 0.06 6.8 2.02
VALUE OF IMPORTED AND INDIGENIOUS RAW MATERIALS STORES, SPARES AND LOOSE TOOLS
Imported Raw Materials 0 0 0 0 0
Indigenous Raw Materials 0 0 0 0 0
STORES, SPARES AND LOOSE TOOLS
Imported Stores And Spares 0 0 0 0 0
Indigenous Stores And Spares 0 0 0 0 0
DIVIDEND AND DIVIDEND PERCENTAGE
Equity Share Dividend 0 0 0 0 0
Tax On Dividend 0 0 0 0 0
Equity Dividend Rate (%) 10 0 0 0 0

144
Capital Structure for the year ended 31-3-2022.
Authorized Issued
Period Instrument Capital Capital Paid-up
Shares Face
From To (Rs. cr) (Rs. cr) (nos) Value Capital

Equity
2022 2023 Share 850 754.96 754,958,148 10 754.96
Equity
2021 2022 Share 850 754.96 754,958,148 10 754.96
Equity
2020 2021 Share 928 754.96 754,958,148 10 754.96
Equity
2019 2020 Share 928 754.96 754,958,148 10 754.96
Equity
2018 2019 Share 928 754.95 754,954,948 10 754.95
Equity
2017 2018 Share 600 518.66 518,657,231 10 518.66
Equity
2016 2017 Share 600 517.73 517,727,631 10 517.73
Equity
2015 2016 Share 600 463.13 463,129,994 10 463.13
Equity
2014 2015 Share 600 462.81 462,805,414 10 462.81
Equity
2013 2014 Share 600 462.79 462,786,314 10 462.79
Equity
2012 2013 Share 600 405.21 405,207,335 10 405.21
Equity
2011 2012 Share 600 405.18 405,179,715 10 405.18
Equity
2010 2011 Share 600 405.1 405,103,475 10 405.1
Equity
2009 2010 Share 600 317.32 317,323,609 10 317.32
Equity
2008 2009 Share 600 226.67 226,666,533 10 226.67
Equity
2007 2008 Share 322 226.67 226,666,533 10 226.67
Equity
2006 2007 Share 272 180.67 180,670,094 10 180.67
Equity
2005 2006 Share 198 170 169,999,900 10 170

145
 APPENDIX-3

Master Thesis Work

PROGRESS REPORT
SL NO PARTICULAR
1 Name of the student GOUTHAM.R
2 Registration Number P18BR21M0066
3 Name of College Guide BINDHUSHREE.K
4 Name and contact no of NAME: BHARATH SOMSHEKAR
the Co-Guide/External CONTACT: 9900190487
Guide (Corporate)
5 Title of the Master Thesis A EMPIRICAL STUDY ON MERGERS AND
ACQUISITION ON ITS DOWNFALL AND
BENEFITS IN THE FIELD OF HEALTH
SECTOR (FORTIS).
6 Name and Address of the FORTIS HOSPITAL LIMITED
Company/Organization #62, RICHMOND ROAD, BEHIND SCARED
where Master Thesis HEART CHURCH, RICHMOND ROAD,
undertaken with date of BENGALURU, KARNATAKA-560025.
starting Master Thesis
7 Progress report: A brief MEETING WITH INTERNAL GUIDE:
note reflecting, Number of  22-09-2023
meeting with Guide,  29-09-2023
Places visited, Libraries  13-10-2023
visited, Books referred,  20-10-2023
meeting with persons, REFERENCES AND ACTIVITIES:
activities taken up, As the above mentioned title of the research to
preparation done for data be done on current condition and situation. So
collection and analysis of the references that could be taken like,
data etc.., Internet Articles.
News papers.
Magazine.
Social Media.

Date:

Signature of the candidate: Signature of the college Guide

 A EMPIRICAL STUDY ON
MERGERS AND
ACQUISITIONON ITS
DOWNFALL AND
BENEFITS IN THE FIELD
OF HEALTH SECTOR
(FORTIS)
by Goutham.R Reg No: P18br21m0066

Submission date: 10-Nov-2023 10:22PM (UTC+0800)

Submission ID: 2223885738

File name: Goutham.docx (1.55M)

Word count: 33104

Character count: 195726