HDFC Life Insurance Co. Ltd and Max Life Insurance Co. Ltd on Monday announced a merger that will eventually create India’s largest listed private-sector insurer with an estimated market value of Rs 67,000 crore. The companies will engage in a series of transactions and the deal is likely to be completed in the next year, reported the Economic Times.
An HDFC official told Economic Times that the relative valuation of HDFC Life and Max Life would be 69% and 31%, respectively. The merged entity will retain the HDFC Life name and will become a listed company with HDFC Ltd and Standard Life (Mauritius Holdings) 2006 Ltd as its promoters. It will be headed by HDFC Life Executive Officer Amitabh Chaudhry.
In the merged entity, five companies will have stakes. While HDFC will have the lion's share of stake [42.5%], Standard Life will have a 24% stake. Mitsui Sumitomo will have 7.8%, Max Group will have 6.6% and Axis Bank will have 1.2%.
According to Livemint, the merged entity, which will have an asset base of Rs 1.1 trillion, will overtake ICICI Prudential Life Insurance Co. Ltd as India’s largest private insurer. The state-owned Life Insurance Corporation of India, which had assets worth Rs 21.70 trillion at the end of March 2016, is still far ahead.