French insurance major Axa Group, with $840 billion assets under its management, is making a back-door entry into the country by taking stake in a third-party administrator (TPA).
Axa Assistance, the largest assistance company in the world for third-party logistics, will make an initial investment of $2 million in Ican Medicare. It will bring in an additional $5 million to the venture within two years depending upon requirements. With this, it will take majority stake in the holding company, and restrict itself to 26 per cent in the TPA venture.
The Indian healthcare market estimated to grow by leaps and bound and see levels of Rs 6,000 crore to Rs 7,000 crore. Following the insurance regulator having called back its earlier decision not to allow the sale of health products by TPAs, will attract leading global players like Aetna, Brooke Shield, and Blue Cross among others, to the Indian market.
The cap on foreign direct investment however, continues to be restricted to 26 per cent.
Axa signed a memorandum of understanding (MoU) with Ican late last month. It was agreed that as Axa brings in more funds into the country, Ican would give up management control in favour of Axa, stated informed sources with a leading public sector insurance company. Axa Assistance wishes to take majority control to ensure international operating standards.
The Insurance Regulatory and Development Authority (IRDA) has been informed about the prospective changes in the shareholding pattern, and is also aware of Ican
