)
On Wednesday, Sundaram Finance Ltd (SFL) and the UK’s RSA Group announced an end to their insurance venture, Royal Sundaram Alliance Insurance Company Ltd, with SFL and other TVS Group companies deciding to buy back RSA’s 26 per cent stake for Rs 450 crore. T T Srinivasaraghavan, SFL’s managing director, tells T E Narasimhan though RSA brought value to the company, its exit won’t be a hurdle, as SFL has the wherewithal to run the show on its own. Edited excerpts:
What led to the RSA Group’s exit?
It’s part of their global strategy. In the past six months, the company exited from non-core markets, including Singapore, Hong Kong and China. It is likely to exit Thailand, too.
We are sorry to see them going but strategic compulsions are there in all businesses.
What impact will the move have on Royal Sundaram? Do the Indian promoters have enough expertise to run the company, especially in terms of developing products?
It (RSA) added a lot of value to the technical aspects of the business. Undoubtedly, it was a valued business partner, but the day-to-day business was run by us. We have enough talent within the company and in the industry. So, it is not a concern at all.
It’s an era of ‘Make in India’; the show will not stop if they (RSA) are not there.
Will there be any change in the management?
No
Will the name Royal Sundaram Alliance be changed?
The next steps are to secure regulatory approvals and complete the transaction. If there’s a need to change the name after the regulatory approvals, that would be looked at.
Ajay Bimbhet, managing director of Royal Sundaram Alliance, has applied for a payments bank licence in his personal capacity. Does that mean he will exit the company?
His term is ending by the end of this year. We don’t know what will happen beyond that. Bimbhet has to decide on it.
Will you consider roping in a new partner?
We (SFL and RSA) have shown an intention to part ways and the process is expected to be closed in the next two-three months, subject to regulatory approvals. After that, we have to take stock of where the business is and then, discuss about the future.
Today, we don’t see any requirement and nothing is on the table. It is premature to comment on roping in a new partner.
