Max Health Institute to lend Rs 300 crore to Max Hospitals

16 Dec 2022 , 08:03 AM

On Thursday, Max Healthcare Institute Ltd. said that its board has approved giving funding of up to Rs300 crore to its wholly-owned business Max Hospitals and Allied Services Ltd. to help cover the cost of the hospital’s Phase-I bed expansion at Dr. Balabhai Nanavati Hospital in Mumbai.

The finance by way of a loan, deposit, or investment in the firm’s securities up to Rs300 crore was approved by the board of the company at its meeting on Thursday, Max Healthcare Institute Ltd (MHIL) reported in a regulatory filing.

In addition, the business stated that its board had approved the issuance of a sponsor’s undertaking to the lending bank or financial institutions to Dr. Balabhai Nanavati Hospital (BNH) to confirm that it would continue to hold a 100% stake in Max Hospitals and Allied Services Ltd. (MHASL) and pay the shortfall resulting from project cost and timeline overruns.

The BNH will receive an additional 329 beds as part of the Phase-I expansion plan, bringing the total number of beds to 660. The petition also mentioned that 2025 is the anticipated completion date.

Regarding the justification for the action, MHIL stated that BNH has been seeing an increase in patient foot traffic and high occupancy rates.

According to the filing, “it is necessary to invest in the expansion of the bed capacity at BNH, in order to cater to an expected increase in demand for healthcare services, given the growing demand for quality healthcare due to increased insurance penetration, preponderance of lifestyle disease, ageing population, and rise in affordability.”

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