 "Apollo Hospitals Group to sell 23.3% stake in Apollo Munich Health Insurance")
Apollo Hospitals Group will sell 23.3 per cent stake in Apollo Munich Health Insurance to Munich Re. This deal values the insurer at Rs 703 crore. The Board of Directors of Apollo Energy Company, an Apollo Hospitals Group Company, at a meeting on Monday, approved the divestment of 23.3 per cent shareholding in Apollo Munich to its joint venture partner, Munich Re of Germany for Rs 163.5 crore.
Completion of the proposed transaction is subject to applicable regulatory approvals and execution of customary agreements, which is expected to be completed at the end of the first quarter of 2016.
After consummation of the transaction, Apollo Hospitals Group's shareholding in Apollo Munich would stand reduced from 74.4 per cent to 51.1 per cent. Correspondingly, Munich Re's shareholding in Apollo Munich would move to 48.7 per cent and 0.2 per cent will be held by employees. Apollo Hospitals would continue to hold its stake in Apollo Munich, the company said.
Dr Prathap C Reddy, chairman of Apollo Munich Health Insurance Company Ltd and Apollo Hospitals Enterprise said, "Insurance is a key element for making quality health care facilities accessible to the masses. The show of confidence from our JV partner will go a long way in helping the group achieve its vision of 'Healthcare for all'."
The opportunity for Munich Re to increase its shareholdings was provided through the decision of the government in March 2015 to increase the foreign direct investment cap in the insurance sector from 26 per cent to 49 per cent.
Doris Höpke, the member of the Munich Re Board of Management responsible for Munich Health said "With the increased stakeholding, we are strengthening our position for sustainable and profitable growth in this region. Apollo Munich Health Insurance is committed to make quality healthcare easy and accessible."
Axis Capital acted as the financial advisor to Apollo Hospitals group for the transaction.
