New Delhi: In a major deal likely to materialise soon, the KKR backed Radiant Healthcare is in progressive discussion to acquire Max Healthcare.
Medical Dialogues had earlier reported that Life Healthcare Group Holding which has the said 49.7% stake in Max Healthcare Ltd is considering a sale of its stake. Max Healthcare, a subsidiary of Max India is a subsidiary of Max India in which Life Healthcare and Max India each own 49.7% stake whereas Analjit Singh and his family own 40.97 per cent of the listed Max India, which has other subsidiaries including Max Bupa, which is healthcare insurance joint venture, and Antara, a senior-living platform.
Radiant led by Abhay Soi is into the business of developing and redeveloping hospitals to provide high-end quaternary care. In 2010, Radiant forayed into healthcare with the re-development and commissioning of BLK, a 650-bed hospital and one of the largest private sector hospitals in Delhi and NCR. Beside this Radiant had collaborated with the Nanavati Hospital Trust in 2014 to take over the operations of Nanavati, a 350-bed multi-speciality hospital.
The development comes after Max India entered into a definitive agreement to buy a 49.7 per cent stake in Max Healthcare for $293 million from South Africa-headquartered Life Healthcare Group Holdings last September, two people close to the development told ET.
A recent ET newsreport detailed that As per the deal structure, Max India will first be vertically split into two parts to create a new holding company. The holding company will have a 49.7% stake in Max Healthcare. The shareholding structure of Max Healthcare and the holding company will be identical. Simultaneously, Max Healthcare will merge with Radiant Life Care. The merged entity will house the hospitals of Max Healthcare and two hospitals of Radiant Healthcare. This merged entity will then reverse merge with the holding company.
“The deal is being structured in such a way that the combined healthcare business will be listed on the Indian bourses with KKR as the dominant investor with about 50% stake,” said one of the persons quoted above. “Analjit Singh, the founding promoters of the Max Group, will have about 15-16% stake and Abhay Soi, who owns a 51% stake in Radiant Life Care, will have a 14-15% stake in the ultimate listed company,” sources informed ET.
The remaining stakes which will be around 20% will be with the public shareholders of Max India. Max India promoters are likely to be classified as non-promoters which will exempt them from compulsory one year lock-in period, the report added.
The proposed transaction will value Max Healthcare at about Rs 5,500 crore, said the person cited above.
The report further added Max India is also in talks with private equity firm True North Managers LLP to divest its 51% stake in Max Bupa Health Insurance.