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
Max india limited

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

Three-step summary of Negen Capital value creation from the Max investment.