Special Situation Case Study – Max India
- Max India used to suffer from significant corporate governance discount due to its promoter’s sketchy reputation.
- It also suffered from ‘Holding Company’ Discount due to multiple non essential and loss making businesses inside.
- Along came KKR & Mr.Soi and proposed a new structure which did the following: 1- Merged Max Health & Radiant Health. 2- Demerged the rest of the loss making businesses into a separately listed company
What This Merger & Demerger Did For Max Health Was Incredible.
- Pre-Merger/Demerger.
- Holding company structure.
- Corporate governance overhang.
- Regional player with no focus.
- Average to poor company overall.
- Post Merger/Demerger.
- Holding company became a pure operating company.
- Old promoter went out and MNC promoter came in with a firm view to grow the business.
- Merger with Radiant catapulted Max Health to being India’s second largest Hospital network.
- Incentive led ownership structure handed out to upper management created skin in the game.
Max Health Post Listing Result And Impact On NEGEN CAPITAL PMS
