HC approves Max India's demerger
Max India announced that it had got HC of Punjab and Haryana's approval for 'restructuring' and for the company's demerger into 3 distributed entities. The demerger will come into effect from January. After the demerger on the effective date in January, the existing company, Max India will become Max Financial Services Ltd (current shareholders will get 1 equity-share of Rs.2 in the new entity).
Max India was was established in 1985, starting out with the "business of manufacturing penicillin-based drugs, bulk active pharmaceuticals and packaging films". Max India ventured into partnerships across conventional and new age sectors. Its joint ventures with groups like "New York Life, Gist-Brocades, Elf Atochem, Hutchison Telecommunications" have transformed it into healthcare, IT and financial services giant.
Max India board approved a corporate restructuring plan inorder to "vertically split the company through a demerger" into 3 companies to render sharper focus on each business. Through the demerger, the group will have 3 separate business verticals for life insurance, healthcare (health insurance & allied businesses) and manufacturing activities - Max Financial Services; Max India Ltd and Max Ventures and Industries Ltd respectively.
The proposed demerger was an important strategic development and was taken up to provide Max investors "specific and undiluted access to Max India's diverse lines of businesses, provide sharper focus" to each business vertical. It would also allow to "unlock shareholder value." 1 April 2015 had been appointed the date for the demerger which was expected to be completed within the upcoming 6-9 months.
Max India shareholders' gave it a hearty approval to go ahead with the plans for the demerger of the company. The Court convened a meeting of the equity shareholders in which 99.99% of the shareholders gave the scheme its approval. Max India had already received approvals for the demerger from SEBI, Bombay Stock Exchange & the National Stock Exchange and Competition Commission of India.
For the year 2015, Max India which has a customer base of 4.4 million recorded a consolidated turnover of Rs.7836 crores, and a consolidated operating revenue of Rs.6,300 crores.
