Shares of Max India
were trading 12% down on Wednesday after the company’s board approved stake sale of 51% in Max Bupa Health Insurance to True North.
"The board approved a proposal relating to the divestment of entire shareholding of the Company in its material subsidiary viz. Max Bupa Health Insurance Company Limited (equivalent to 51% of Max Bupa's total issued and paid-up share capital) to True North Fund VI LLP (either directly or through any of its affiliates) (Proposed Transaction),” the company said in a press note after market hours
to the exchanges on Tuesday.
The proposed transaction is an all-cash transaction and it values Max Bupa at an enterprise value of Rs1,001cr.
Meanwhile, the transaction is subject to the terms of the definitive agreements to be executed among the parties and receipt of requisite approvals including the approval of the Insurance Regulatory and Development Authority of India (IRDAI) and the shareholders of the Company.