MAX Ventures shares jump 10 percent as New York Life re-enters Max Group

 Shares of Max Ventures (MAXVIL), a subsidiary of the Max India group, rose 10.37 percent to Rs 74 on BSE on Wednesday, after the company confirmed that New York Life Insurance—the largest life insurance company in the United States—will acquire 22.51 percent stake in the company, for an offer price of Rs 78 per share, for a total amount of Rs 121 crore.

MaxVIL is the newest entity in the Max Group of companies that came into existence after the erstwhile Max India Group was demerged in January 2016, into Max Financial Services Limited, Max India Limited and Max Ventures and Industries Limited (MaxVIL). Max Ventures handles investment in the manufacturing and real estate development firm. Max Speciality Films, Max Estates, Max I. Ltd and the education vertical are subsidiaries of MaxVIL.

“The funds will be used for the capex requirements in the education, speciality packaging films and real estate business primarily,” Sahil Vachani, managing director and CEO of Max Ventures and Industries Limited, told Forbes India. “The proportion of investment in each of these businesses will be decided subsequently.”

Vachani said New York Life, who were founding partners in Max Group’s life insurance joint venture (called Max New York Life in 2001), said that the “long association” with the group will be of great assistance. In 2012, New York Life sold its 26 percent stake in Max New York Life to Mitsui Sumitomo Insurance Co. Ltd., after which the life insurance company was renamed Max Life.

MaxVIL has set out plans for 2017 and is currently expanding capacity in its speciality packaging films business and has also begun work on a couple of real estate projects through its subsidiary Max Estates, Vachani said. The company has also bought a minority stake in Azure Hospitality and Nykaa.com through its investment subsidiary Max I, which provides financial capital to early-stage organisations.

MaxVIL will soon enter the education space.

Speaking of the association of the two partners, Analjit Singh, founder and chairman emeritus of the Max Group and chairman of MaxVIL said, “It is very special to have New York Life at the take off stage of MaxVIL…..”

MaxVIL reported consolidated revenues of Rs 710.73 crore for the financial year ended March 2016 and net profit of Rs 19.38 crore for the same period.