ICICI Lombard General Insurance Company and Bharti AXA General Insurance Company signed agreements to combine their non-life insurance businesses.
Bharti AXA General Insurance is a joint venture between Bharti, an Indian business group with interests in telecom, agriculture business and retail, holding 51% stake and AXA, a global insurance and asset management company, holding the remainder 49% stake.
In a BSE filing made after market hours on Friday (21 August 2020), the ICICI Group company announced that its board and the board of Bharti AXA General Insurance Company had approved entering into definitive agreements for demerger of Bharti AXA's non-life insurance business into ICICI Lombard through a scheme of arrangement.
Based on the share exchange ratio accepted by the respective boards of the two companies, the shareholders of Bharti AXA shall receive 2 shares of ICICI Lombard for every 115 shares of Bharti AXA held by them as on the date of the approval of the proposal by the two respective boards.
The proposed transaction provides a meaningful opportunity for ICICI Lombard to consolidate its market leading position in the non-life insurance sector, becoming the third largest non-life insurer. The combined entity shall have a market share of approximately 8.7% on pro-forma basis with annual premiums aggregating to Rs 16,447 crore.
Through this proposed transaction, ICICI Lombard shall be able to augment its distribution strength with Bharti AXA's existing distribution partnerships. The combined entity shall also benefit from continued partnerships with Bharti Enterprises, one of India's leading business groups with diversified interests, and AXA, a large wellreputed global insurer.
Commenting on the announcement, Bhargav Dasgupta, MD & CEO of ICICI Lombard General Insurance said, This is a landmark step in the journey of ICICI Lombard and we are confident that this transaction would be value accretive for our shareholders. We are excited by the capabilities and strengths that Bharti AXA will add to our franchise.
ICICI Lombard General Insurance is a private sector non-life insurer. The company offers a diversified range of products, including motor, health, fire, personal accident, marine, engineering and liability insurance, through multiple distribution channels.
The scrip rose 0.48% to Rs 1299.05 on the BSE. It traded in the range of 1275.25 and 1304.80 so far during the day.
Powered by Capital Market - Live News
Disclaimer: No Business Standard Journalist was involved in creation of this content
