IFC Expands Access to Health Services in India with Investment in Max Healthcare
IFC, the private sector arm of the World Bank Group, will invest in Max Healthcare Institute, one of the fastest-growing health care providers in India. Over the next four years, IFC’s investment will help expand the company’s operations. It will also enable enhanced access to high-quality health care to a larger number of people.
As incomes rise in India, demand for high-quality health care is also increasing. According to the World Health Organization and the Confederation of Indian Industries, the private sector is crucial to the provision of health care in the country and will account for 75 percent of all health care expenditure after investment by the government and other agencies. Creating an adequate hospital infrastructure will require $34 billion in private investment by 2012 in secondary and tertiary care hospitals, medical colleges, nursing schools, and hospital management schools.
IFC’s INR3 billion (about $67.2 million) investment in Max Healthcare Institute will include INR500 million (about $11.2 million) of common equity and INR2.5 billion (about $56 million) of preferred, cumulative, and redeemable equity.
The proposed expansion will add 452 beds to the company’s existing 765 bed capacity. It will include adding 268 beds to the Patparganj hospital; a new 100-bed secondary and tertiary hospital in Dehradun; and a new 84-bed tertiary hospital focused on obstetrics, gynecology, and pediatrics at Saket, Delhi. There will be additional expansions. The project will also create 4,500 jobs in the medical industry during the construction phase.
Analjit Singh, Chairman, Max India Limited, said, “Max Healthcare is proud to partner with IFC. This partnership recognizes our efforts to establish benchmarks of medical excellence and outstanding quality of service. IFC’s investment will help us realize our vision of emerging as one of India’s leading health care providers.”
Guy Ellena, IFC Director for Health and Education, said, “While the government is focusing its resources on increasing services to rural areas, it is critical for the private sector to complement the public sector by expanding access to meet the demand. With its international standards of patient-centered care, Max Healthcare will provide easily accessible and high-quality health care at an affordable price.”
Paolo M. Martelli, IFC Director for South Asia, added, “IFC’s proposed investment is aligned with our strategy to invest in health care, one of India’s largest service industries. This project demonstrates IFC’s commitment to social sector development. By providing long-term, local currency financing, we are further developing a market for private health care facilities.”
IFC, the private sector arm of the World Bank Group, promotes open and competitive markets in developing countries. IFC supports sustainable private sector companies and other partners in generating productive jobs and delivering basic services, so that people have opportunities to escape poverty and improve their lives. Through FY06, IFC Financial Products has committed more than $56 billion in funding for private sector investments and mobilized an additional $25 billion in syndications for 3,531 companies in 140 developing countries. IFC Advisory Services and donor partners have provided more than $1 billion in program support to build small enterprises, accelerate private participation in infrastructure, improve the business-enabling environment, increase access to finance, and strengthen environmental and social sustainability. For more information, please visit www.ifc.org.
About Max Healthcare Institute
Max Healthcare Institute is a subsidiary of Max India that began with the manufacture of bulk drugs in the 1980s. It is now a multibusiness company with interests in life insurance, health care, clinical research, and specialty plastics. Max Healthcare Institute operates on a hub-and-spoke model, with two tertiary care hospitals as the hub and primary and secondary care hospitals, as well as diagnostics and laboratory centers as the spokes, enabling patients to transit from one care provider to another. The company’s two tertiary care hospitals specialize in cardiac care, neurology, orthopedics and joint replacements, pediatrics, obstetrics, and gynecology. Services at the secondary care hospitals include a complete range of surgical and inpatient procedures such as maternity, general surgery, and emergency services. The hospitals also provide outpatient services. The company has over 1,250 doctors and about 100,000 patient transactions a month.
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