Max Healthcare Promoter Analjit Singh Sells 4.6% Stake To Reduce Debts

Max group’s founder Analjit Singh sold its 4.6% stake in Max Healthcare to the London-based wealth management company Capital International. According to the reports from Livemint, the founder will be using around USD 70 Million (₹515 crores) to pay off his personal debts he owns to various people.

The India-based tabloid also reported that the promoters of the Max group are selling their personal stake from the group’s healthcare and financial services firms to raise around USD 290 Million (₹2,300 crores). The plan to raise came after they sold off their London’s Mayfair for over USD 100 Million. Earlier, Singh’s family was looking to raise money by selling 7% of the stake.

As per December 2019, Max Group’s debts stood around USD 462 Million. “We are fully committed to reduce the debt considerably within the current year. We have been working towards it in a structured manner. Our divestment of some private real estate in the UK recently allowed us to trim the debt to quite an extent. We plan to take some significant actions in the near future to become almost debt-free,” Singh’s family spokesperson said in a statement. According to the reports, the family is trying to sell more of its overseas real estate.

Max Group’s promoters are also seeking to sell around 10-15% out of their total 28.31% stake in Max Financial Services Ltd for around USD 200 Million. On Friday, the company’s shares were trading by 14% after the news on the Bombay Stock Exchange (BSE). “The stake sale was planned after the control of Max Healthcare was transferred to Radiant Life Care Pvt. Ltd. After that deal, Singh is no longer the owner of Max Healthcare and this particular stake sale was strategically aimed to reduce the debts of the family that were availed in their personal capacity,” the tabloid reported.

Radiant Life Care Pvt. Ltd. completely acquired the control of Max Healthcare Institute Ltd. in December 2018. The company didn’t buy the Max group’s unit in one go. While at first, it bought around 49.7% stake from South African hospital operator Life Healthcare in an all-cash deal. Just after the sale, the part of the Max Healthcare- Max Bupa and Antara Senior Living were separated into two different units. Thereafter, Radiant gave KRR and its promoter Abhay Soi, a majority stake in the unit. Currently, KKR owns 51.9% and Soi 23% in the Max Healthcare unit.

Earlier this month, Max Healthcare reported a loss of around USD 48.3 Million owing to the COVID-19 pandemic. In its regulatory filing, the company posted a profit of around USD 1.2 Million.  Last month, Max Bupa discontinued its cashless payment option to its policyholders. The company runs in a joint venture with Indian private equity firm True North and UK-based healthcare services firm Bupa. Max Bupa spokesperson said that they had to stall the services owing to the expiration of the contract between Max Healthcare and them in May 2019.

The spokesperson for Max Healthcare also said that they are in talks with Max Hospitals on revised tariff plans.  In spite of our best efforts, the contract couldn’t be closed to the satisfaction of both the parties, and hence Max Healthcare has been left with no choice but to suspend cashless services for Max Bupa customers,” the person added.