Financial Daily from THE HINDU group of publications
Tuesday, May 25, 2004
Financial Daily from THE HINDU group of publications Tuesday, May 25, 2004 |
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Corporate
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Mergers & Acquisitions Money & Banking - Insurance Warburg Pincus to pick up 29% stake in Max India Our Bureau
New Delhi , May 24 PRIVATE equity fund Warburg Pincus has decided to pick up 29 per cent stake in Max India Ltd by investing Rs 200 crore in the company. It will pick up 10 million equity shares of Rs 10 per share at an issue price of Rs 200 per share through the preferential route. This will take the total investment of Warburg Pincus in India to over $850 million, which includes investments in companies such as Bharti Tele-Ventures, Gujarat Ambuja, Moser Baer, Nicholas Piramal, Rediff and WNS Global Services. In a statement, Mr Analjit Singh, Chairman of the Max Group said, ``Raising additional capital at this stage of build-out of our new service sector businesses was part of our long-term financial plan to support our two capital intensive businesses of life insurance and healthcare. Max believes this partnership would accelerate the growth plans in the life insurance and healthcare provider sectors.'' Max has a presence in the life insurance business through its joint venture with New York Life - Max New York Life Insurance and healthcare business. Max Healthcare is aiming at providing fully integrated healthcare delivery system, offering within one model, all 3 levels of care - primary, secondary and tertiary. The company plans to complete this multi-location facilities model in National Capital Region of Delhi, with a targeted investment of Rs 520 crore, substantially within 2004-05. ``Having completed the restructuring of the group, the company has now fully tied up the long term funding needs of its life insurance and healthcare businesses. The partnership with Warburg Pincus further underscores the strong value creation potential of Max India,'' said Mr B. Anantharaman, Group Finance Director, Max India. As part of the restructuring Max India exited its pharmaceuticals and medical transcription businesses focusing on its core businesses of life insurance and healthcare. However, the company continues to hold a 10 per cent stake in Hutchison Max Telecom, operating cellular telephony services in the Mumbai circle. According to Mr Dalip Pathak, Managing Director, Warburg Pincus LLC said, ``The life insurance and healthcare services sectors have high growth potential. Our investment is evidence of our confidence in the strong fundamentals of India's economy, the company's growth potential and its superior management team.''
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