A doctor looks at his mobile phone in an intensive care unit (ICU) at an Apollo Speciality Hospital, operated by Apollo Hospitals Enterprises Ltd., in the Vanagaram area of Chennai, India, on Saturday. (Photographer: Dhiraj Singh/Bloomberg)

Radiant Life To Merge With Max Healthcare

Dec 24 2018, 11:29 AMDec 24 2018, 11:42 AMDecember 24 2018, 11:29 AMDecember 24 2018, 11:42 AM

Radiant Life Care Ltd., backed by private equity firm KKR, agreed to merge with Max Healthcare Ltd. in a complex deal that, it said, will make the combined entity India’s third-largest hospital and diagnostics company.

The merged entity will operate over 3,200 beds through 16 hospitals across India and will be among the top three by revenue and the fourth-largest by beds, according to a company statement. The combined entity will be valued at Rs 7,242 crore.

This is how the multi-step transaction is structured:

Radiant Life will buy 49.7 percent in the publicly listed Max Healthcare from South Africa-based hospital operator Life Healthcare in an all-cash deal. At the same time, Analjit Singh-promoted Max India Ltd. will demerge healthcare and investment businesses into separate entities.
Radiant Life will then merge with the Max Healthcare, giving KKR and Radiant promoter Abhay Soi the majority stake in the combined entity. The healthcare business will be 51.9 percent owned by KKR, 23.2 percent by Abhay Soi and 7 percent by Max India promoters. The Max promoters will sell 4.99 percent in the combined entity to KKR at a later stage at Rs 80 apiece, Soi told BloombergQuint over the phone.
The spun-off investment business of Max India will continue to hold stakes in Max Bupa Health Insurance, Pharmax Corporation, Antara Senior Living, Max Ateev, Max UK and Max Skill First. It will be separately listed after the healthcare merger.
The shareholders of Max India will receive one share in the investment business for every five held in Max India.