South African partner moves to exit Max Healthcare; Varroc plans IPO
Photo Credit: Shah Junaid/VCCircle

South Africa-based hospital chain Life Healthcare Group Holdings Ltd is looking to sell its 49.7% stake in Max Healthcare Ltd, Bloomberg reported citing persons aware of the development.

Last month, VCCircle first reported that Life Healthcare was looking to sell its stake in Max Healthcare. VCCircle also reported that Life Healthcare had emerged as a new potential strategic investor in Fortis Healthcare, the second-largest hospital firm by revenues and market value.

Investment bank Barclays PLC is given the mandate to find a buyer, the newswire reported.

Life Healthcare could seek a valuation of $406 million (Rs 2,578 crore) for its stake, the report cited a person as saying.

Launched in 2000, Max Healthcare is an equal joint-venture between Max India Ltd and Life Healthcare Group Holdings Ltd. It provides healthcare services focussed on tertiary and quaternary care.

Last year, International Finance Corp (IFC), the private-sector investment arm of the World Bank, sold its entire 7.5% stake in Max Healthcare for Rs 423 crore ($65.3 million).

Max Healthcare’s gross revenues stood at Rs 2,567 crore and profit before tax was Rs 24 crore in the year through 31 March 2017.

Tata Housing and Lodha eye Jaypee Infratech

Real estate companies Tata Housing and the Lodha Group have submitted initial expressions of interest for debt-laden realty developer Jaypee Infratech Ltd, The Economic Times reported citing two people familiar with the development.

The two bidders are interested in buying Jaypee Infratech’s Yamuna Expressway Project, which connects Noida to Agra, the people mentioned above added.

“The bidders, apart from purchasing the assets, need to infuse around Rs 2,000 crore to complete the projects already taken up by Jaypee Infra,” ET quoted one of the persons mentioned above as saying.

Jaypee Infratech is currently undergoing a corporate insolvency resolution process initiated by the National Company Law Tribunal as it failed to repay loans worth Rs 526 crore to IDBI Bank, the ET report said. The lender had filed for insolvency proceedings against Jaypee Infratech in August last year, the report added.

Jaypee Infratech is owned by Noida-based Jaiprakash Associates Ltd, the flagship company of the debt-laden Jaypee Group. Jaiprakash Associates is one of several infrastructure developers in the country that have struggled to repay loans taken on earlier for expansion.

As on 31 March 2017, the company’s total debt was around Rs 9,515 crore, according to its annual report.

The company’s revenue the Yamuna Expressway toll was Rs 292.72 crore in the financial year 2016-17.

Jaypee Infratech is also developing five townships over 25 million square metres of land along the Yamuna Expressway, according to its latest annual report.

Varroc Engineering to float IPO

Auto components maker Varroc Engineering Pvt. Ltd is soon expected to file its draft red herring prospectus for an initial share sale and has appointed investment banks to advise it, a report in Mint stated, citing two people aware of the development who requested anonymity.

Kotak Mahindra Capital and Credit Suisse were given the mandate to run the initial public offer, the report added.

In 2014, Tata Opportunities Fund, the flagship private equity fund of Tata Capital, and Tata Capital Financial Services invested Rs 300 crore ($48.55 million) in Varroc Engineering for a 9% stake on a fully diluted basis through preferential allotment, according to VCCEdge, the data intelligence platform of NewsCorp VCCircle.

“Tata Opportunities Fund is likely to sell part of its stake through the IPO, while the company will look to raise funds to invest in the business. The exact quantum of these are yet to be finalised,” one of the persons mentioned above told the financial daily.

Founded in 1990, Varroc Group manufactures and supplies exterior lighting systems, power trains, electricals and electronics, body and chassis parts to passenger car and motorcycle makers, information on its website states.

The company’s consolidated net sales stood at Rs 8,348.1 crore and profit after tax was Rs 245.5 crore in the year through 31 March 2017.

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