MUMBAI: Bain Capital Private Equity has joined the race with US private equity firm KKR and its Indian hospital chain partner Radiant Life Care to buy a 47% stake in Max Healthcare from South Africa’s Life Healthcare for between $450 million and $540 million, two people with knowledge of the development said.
Max Healthcare, which runs 14 hospitals with 2,500 beds in north India, is an equal joint venture between Indian billionaire Analjit Singh and Life Healthcare.
“KKR-Radiant and Bain Capital have started discussions on purchasing Life Healthcare’s stake in the company,” one person said.
The companies entered the fray after Life Healthcare held discussions with its Indian partner on leaving the venture and appointed global investment bank Barclays as advisor. Life Healthcare and Max India own 47.5% each in Max Healthcare, while the remaining 5% is held by key management executives of the company. ABain Capital spokesperson said it had “no comment” on the matter.
Radiant MD Abhay Soi did not respond to text messages seeking comment. A Max India spokesperson did not respond to an emailed questionnaire. “We cannot comment on any detail of the discussions relating to the transaction,” a Life Healthcare spokesperson said.
Bain Capital joins KKR in race for Max Healthcare stake
Life Healthcare, the second-largest private hospital owner in South Africa, could seek up to $450-500 million for its stake in Max Healthcare, ET reported in January.
Shrey Viranna, group chief executive of Life Healthcare Group, told ET in an emailed response in April that the company is in discussions with Max Healthcare “about exiting the Indian market and this is aligned to the group’s business strategy and investment outlook. We are not in a position to disclose the valuation process as this is still under way.”
KKR-Radiant was among the unsuccessful bidders for Fortis Healthcare, which is being taken over by Malaysia’s IHH Healthcare. Consolidation is taking place in India’s healthcare sector as the financial health of hospitals deteriorates with profits shrinking and regulatory curbs hitting their revenue.