Max India to sell 26% in unit for Rs 516 cr

Healtcare firm Max India today said it had entered into a deal to sell 26% stake in a subsidiary, Max Healthcare Institute, for Rs 516.5 crore to a South African company.

Max India, promoted by Analjit Singh family, said in a regulatory filing that it has entered into a non-binding term sheet with South Africa-based Life Healthcare Group "to issue and allot" shares constituting 26% stake of Max Healthcare Institute for Rs 516.5 crore.

Max India holds 91% stake in Max Healthcare Institute. It could not be ascertained that who holds the remaining 9% stake currently.

Life Healthcare Group is a leading healthcare service provider in South Africa with a market capitalisation of over USD 2 billion. Its network includes 63 hospitals with over 8,000 beds and a 27% market share in healthcare industry in South Africa.

Max India further said that the transaction is subject to completion of due diligence and necessary regulatory approvals in South Africa.

"The board of the company [Max India] in its meeting held on October 11, 2011, accorded its in-principle approval to Max Healthcare Institute to go-ahead on aforesaid transaction," it added.

Max India shares today fell 0.4% to close at Rs 177.90 on the Bombay Stock Exchange (BSE) in a flat market, where the benchmark Sensex closed 0.13% down.