Max India to venture into new verticals after divesting insurance, healthcare biz

Max India Monday said it is planning to venture into new business verticals, after divesting healthcare and health insurance business.

The new business areas will be in adjacencies to group's current verticals of life insurance, real estate, senior care, hospitality, Max India said in a release.

Max India also said that it will offer shareholders of the company a part of the divestment proceeds from healthcare and insurance business.

The company is currently in the process of selling its 51 per cent stake in health insurance joint-venture Max Bupa to private equity firm True North.

Besides, the company has also inked a deal which will result in its demerger from two listed entities.

The first entity, created from a merger of Max Healthcare with the KKR backed hospital operator Radiant Life Care, will be India's third largest corporate hospital chain with over 3,200 beds and 16 hospitals and will be automatically listed on the Indian stock exchanges, it said.

Max India's other demerged entity, which has currently been named as Advaita, will own the group's business Antara Senior Living. It will also manage a corpus of over Rs 500 crore received from the divestment of Max Bupa, the company said.

Promoter and Chairman Analjit Singh is looking to start afresh in Advaita by venturing into 1-2 new business areas.

The new business areas will have adjacencies to the group's latest focus areas of life insurance, real estate, senior care and lifestyle, it said.

"Besides being utilized for seeding new businesses, Advaita proposes to utilize its cash reserves to also offer an exit opportunity through a capital reduction process, subject to regulatory approvals, to shareholders who may not be keen on investing in unchartered areas. This will allow such shareholders access to proportionate proceeds from Max Bupa divestment and encash their shareholding," the company said.

"Our aim is to recreate the Max India story all over again by seeding high potential businesses and doing them the Max way, which will likely create significant value for those who stay invested with us. I remain committed to grow Max India and retain my shares in the company," Mzx Group founder Analjit Singh said.

The new businesses will be decided within the next year, which is the anticipated timeframe for the demerger and listing of New Max India, currently being called Advaita Allied Health Services Limited.

"Our choice of businesses and smart capital management has resulted in a 23 per cent IRR (internal rate of return) for Max India investors since we went public. This, even when our stock prices are unusually depressed currently. The business portfolio rebalancing will provide fresh impetus to this growth and returns," Mohit Talwar, Vice Chairman, Max Group, said.