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GIC of Singapore and financial services firm Capital Group picked up 26.8% stake in hospital chain Max Healthcare Institute as American private equity giant KKR exited the company by selling its entire stake in the company on Tuesday via block deals. With this, the promoters will now own 24 per cent stake in the company.
Shares of Max Healthcare shot up by nearly 12 per cent to close at Rs 404.70 apiece as KKR sold the stake worth Rs 9,400 crore as part of its exit strategy. KKR and Radiant Group were co-promoters of the company since 2018 and with KKR’s exit, the company’s board will be restructured with three independent directors and new investors’ nominees joining the board in the coming days, said a banking source.
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Abhay Soi will remain the Chairman & MD of the company. In 2018, KKR and Radiant had bought 49.7 per cent stake in Max Healthcare for Rs 2,120 crore. Radiant had acquired the other joint venture partner, South Africa-based hospital operator Life Healthcare, and merged its own assets into Max Healthcare. The entity had over 3,200 beds in 17 hospitals across India. In September last year, KKR had sold part of its stake for Rs 2,956 crore as part of its exit strategy.
The present merged company was formed subsequent to the acquisition of 49.7% stake in Max Healthcare Institute by Radiant Life Care Pvt and the merger of Max Healthcare with Radiant thereafter. Post merger, the new entity assumed the name Max Healthcare Institute.
Last week, Max Healthcare said its consolidated net profit increased by 12 per cent to Rs 229 crore for the June quarter driven by annual price revision and normalisation of patient footfalls.
The healthcare provider had reported a net profit of Rs 205 crore in the June quarter of last fiscal. Net revenue during the period under review rose to Rs 1,393 crore as compared with Rs 1,322 crore in the April-June quarter of the last fiscal.
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