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Max Ventures to sell entire stake in packaging film business for Rs 600-650 crore; to focus on real estate

In a regulatory filing, MaxVIL, which is one of the three holding companies of the USD 4 billion Max Group, informed that the all-cash deal has been struck at an enterprise value of Rs 1,350 crore.

November 15, 2021 / 11:45 AM IST
Mumbai scored 17.1 percent lower than the global homebuyer average. (Source: File Image)

Mumbai scored 17.1 percent lower than the global homebuyer average. (Source: File Image)

Max Ventures and Industries (MaxVIL) on Monday said it is exiting specialty packaging film business by selling its entire 51 per cent stake to Japanese joint venture partner Toppan Printing for Rs 600-650 crore as part of the company’s decision to fully focus on real estate segment.

In a regulatory filing, MaxVIL, which is one of the three holding companies of the USD 4 billion Max Group, informed that the all-cash deal has been struck at an enterprise value of Rs 1,350 crore.

MaxVIL has a presence in packaging film and real estate businesses. The packaging arm Max Speciality Films is a 51:49 partnership with Toppan. It runs realty business through its 100 per cent subsidiary Max Estates.

MaxVIL said it has entered into a definitive agreement with Toppan Printing to divest its remaining 51 per cent stake in the specialty packaging films business for an "enterprise value of Rs 1,350 crore, translating into an equity value of about Rs 600-650 crore."

Toppan will also take over the debt of Max Speciality Films as part of the deal. In 2017, Toppan had acquired 49 per cent stake in Max Speciality Films for about Rs 200 crore and became a strategic partner of MaxVIL.

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In 2017, Toppan had acquired 49 per cent stake in Max Speciality Films for about Rs 200 crore and became a strategic partner of MaxVIL. Max Speciality Films is one of the leading manufacturers of Biaxially Oriented Polypropylene (BOPP) films, including specialty packaging, labels, coating and thermal lamination films, with a total capacity of 72 kilo tonnes per annum. With the divestment of the entire stake, MaxVIL will exit non-core businesses. It will now completely focus on the real estate business in the premium residential and commercial space in Delhi-NCR.

With the divestment of the entire stake, MaxVIL will exit non-core businesses. It will now completely focus on the real estate business in the premium residential and commercial space in Delhi-NCR.

Sahil Vachani, MD and CEO of MaxVIL, said, "The decision to divest the residual 51 per cent stake in specialty packaging business to the existing partner is to generate additional growth capital to deploy in the real estate business that offers tremendous growth opportunities."

After the divestment, MaxVIL said the company would be able to create a war chest of more than Rs 1,000 crore funded from sale proceeds, internal accruals, and potential commitment from financial investors.

This will help in expanding the residential and commercial real estate footprint in Delhi-NCR. New York Life Insurance Company, a longstanding partner of the Group, is a strategic investor in the company, owning about 23 per cent stake.

New York Life Insurance Company, a longstanding partner of the Group, is a strategic investor in the company, owning about 23 per cent stake. The company will continue to look for such strategic/financial partners to back its expansion plans. MaxVIL is in advance discussions with nearly half a dozen landowners to acquire and develop prime land parcels in Delhi-NCR.

MaxVIL is in advance discussions with nearly half a dozen landowners to acquire and develop prime land parcels in Delhi-NCR. Vachani said the company has developed few Grade-A commercial buildings in Delhi-NCR and is well-positioned to scale both its commercial and residential businesses.

Further, the company said the board has authorised its Investment and Finance Committee to explore various modalities for restructuring with Max Estates Ltd and be renamed as Max Estates Ltd after receiving required statutory approvals.

The change of name will resonate better with the business vision, strategy and focus of the company, MaxVIL said. MaxVIL posted a total income of nearly Rs 1,190 crore in the last fiscal year.
PTI
first published: Nov 15, 2021 11:48 am
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