Max India acquires private equity firm Warburg Pincus’ 16.37% stake in its hospital chain Max Healthcare

According to the Economic Times of India (ET), Max India has decided to acquire private equity firm Warburg Pincus’ 16.37% stake in its hospital chain Max Healthcare for Rs 140 crore.

Under the proposed transaction, Max India is buying 4.76 crore shares of the hospital chain at 29.40 rupees per share from Warburg Pincus, the company said in a statement to the stock exchanges. The acquisition is likely to conclude by December this year, increasing Max India’s shareholding in the hospital subsidiary to 91.84%, reported Economic Times.

Commenting on the acquisition, Max India Chairman Analjit Singh said the opportunity to consolidate the company’s shareholding in Max Healthcare has come at the most opportune time when the business has just turned profitable and is all set to double its bed strength. According to Singh, Max Healthcare plans to tap the capital market in 2012-13.

Max India picked up 23% stake in Max Healthcare in two stages between 2004 and 2005 for Rs 140 crore. This was diluted to 16.37% due to issue of fresh shares to other shareholders subsequently, said ET.

Warburg Pincus has been a strategic partner in Max India Group and holds around 14% stake in Max India Ltd , the listed flagship firm.

Singh further reiterated that Max India is very positive on the long-term growth potential of the healthcare industry and this acquisition reaffirms the company’s belief in value creation abilities of Max Healthcare and other businesses of Max India Group.

Max India Limited is a multi-business corporate, driven by the spirit of enterprise and focused on people and service-oriented businesses. The Company’s vision is to be one of India’s most admired corporates for Service Excellence.

Max India Group’s consolidated turnover for FY10 was Rs. 78,360 million. The consolidated operating revenue was Rs. 63,000 million, a growth of 19% over the same period last year. The Group is on a high growth path, with over 400 offices across 300 locations in the country and with people strength of 73,000 persons as on December 2010.

Warburg Pincus focuses chiefly on private equity investing. Established more than 40 years ago, Warburg Pincus has invested more than $35 billion in over 650 companies in more than 30 countries around the world.

The firm’s strategy combines deep industry expertise and local market experience; the flexibility to support all stages of company development; a long-term investment horizon; and fully aligned interests among its portfolio company management, limited partners and general partners.

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