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Deal Flow – 18/02: KKR (Kohlberg Kravis Roberts) buys 9.95% in Max Financial Services (Max India)

Here is the “Deal Flow (Summary of Bulk & Block Deals)” of the data that is revealed in the markets. This has been collated and curated to make trade-able sense.

A Bulk Deal is a trade, where total quantity bought or sold is more than 0.5% of the number of equity shares of the company. A trade, with a minimum quantity of 5,00,000 shares or minimum value of Rs.5 crore executed through a single transaction on this separate window of the stock exchange will constitute a Block Deal.

Deal_Flow_18_February_2016

Max India

Max India Limited, a multi-business corporate, is part of the US$ 2 billion Max Group and is the holding company for Max Healthcare, Max Bupa Health Insurance and Antara Senior Living.

The other entities in the Max Group are Max Financial Services Limited, which holds its life insurance subsidiary and Max Ventures & Industries Limited, which serves as the Group’s entrepreneurial arm to explore the ‘wider world of business’, especially taking cues from the current Government’s economic and commercial reforms agenda.

Max Financial Services Limited (MFS), a part of the US$ 2 billion Max Group, is the parent company of Max Life, India’s largest non-bank private life insurance company. MFS actively manages 72 per cent stake in Max Life Insurance Company Limited, making it India’s first company focused exclusively on life insurance. Max Life is a joint venture with Mitsui Sumitomo Insurance (MSI), a Japan headquartered global leader in life insurance.

Moneyline Portfolio Investments – a Mauritius based entity purchased this stake from a consortium of Investors i.e. Analjit Singh, Maxopp Investments, Medicare Investments and P V T Investment.

Here is the detailed transaction:

Promoter_Holding_Max_India

Though no information is available about Moneyline Portfolio Investments other than the fact that it is a Mauritius based entity, KKR (Kohlberg Kravis Roberts) issued a press release confirming the acquisition of 9.95% stake in Max Financial Services, the newly demerged entity of the Max Group that owns an approximate 72% stake in Max Life, India’s fourth-largest private life insurance player. KKR made its investment from its Asian Fund II through the portfolio investment route.

Max India has received the approval from the Ministry of Corporate Affairs for a change in name from Max India to Max India Financial Services on the 12-Feb-16 (U85100PB2015PLC039155).

Here is what Max & KKR had to say about the deal:

Welcoming KKR’s investment, Mr. Singh said, “KKR has been a long-standing, value-added partner to Max Group across various business initiatives. The extension of our partnership couldn’t have happened at a more opportune time than now, following the listing of Max Financial Services which creates an unparalleled platform to invest in the Indian life insurance space.”

Sanjay Nayar, Member and CEO of KKR India, said, “We continue to believe in India’s growth potential, increase in financial savings and resultant life insurance industry growth. Within the sector we are excited to partner with Analjit Singh and his team at Max Financial Services, a company which is well positioned in the life insurance industry.”

JM Financial executed this trade on behalf of both parties.

How will the demerger work? (more here)

The company will be split into 3 listed entities – Max Financial Services Ltd. with the insurance business, Max India Ltd. with the health and allied businesses, and Max Ventures and Industries Ltd. with the speciality packaging films business.

The original entity – Max India, which will be renamed as Max Financial Services Ltd., will focus solely on the group’s flagship insurance activity, through its 72.1% holding in Max Life. It will be the first Indian listed company exclusively focused on life insurance.

The second entity, named as Max India Ltd., will continue to manage investments health and allied businesses comprising Max Healthcare, Max Bupa, Antara Senior Living and a Corporate Management Services team. The Corporate Management Services team will manage a shared services centre which will provide functional support to all the 3 entities.

The third entity will be named Max Ventures and Industries Ltd. and will house the investment activity in the group’s manufacturing subsidiary Max Speciality Films handling the speciality packaging films business.

As a result of the demerger, Max India’s shareholders will retain 1 equity share of Rs. 2 in Max Financial Services Ltd. and will additionally get one equity share of Rs. 2 each of Max India Ltd. and 1 equity share of Rs. 10 of Max Ventures and Industries Ltd. for every 5 shares held in Max Financial Services Ltd.


Check out the Deal Flow for the other days:

Deal Flow – 16/02: Pinewood Strategy – India Opp. Fund buys Borosil Glass Works and Standard Chartered (Mauritius) sells Shilpa Medicare to CLSA Global Markets

Deal Flow – 15/02: Amansa sells Kirloskar Brothers and Goldman Sachs India mops up more of Teamlease Services

Deal Flow – 12/02: Goldman Sachs and Nomura mop up Teamlease Services, Nordea continues to dump Justdial, Ricky Ishwardas Kirpalani sells Kakatiya Cement Sugar & Industries and Franklin Templeton Mutual Fund sells NRB Bearings

Deal Flow – 11/02: Nordea follows SBI Life Insurance and exits Justdial

Deal Flow – 10/02: Big Whale Ashish Dhawan founded ChrysCapital buys Hindustan Media Ventures and Nordea Mutual Fund buys Reliance Infrastructure

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Disclaimer

Nothing in this newsletter is financial advice and should not be construed as such. Please do not take trading decisions based solely on the matter above; if you do, it is entirely at your own risk without any liability to Capital Mind. This is educational or informational matter only, and is provided as an opinion. 

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