Shareholders of Max Financial Services (MFS) has agreed to allow Mitsui Sumitomo Insurance (MSI) to swap 19.98 per cent of its shareholding in Max Life Insurance with 21.45 per cent stake in MFS.
MFS is the holding company of Max Life Insurance Company (MLIC), wherein MSI holds nearly 26 per cent stake.
Shareholders have given approval for allotment of up to 7.35 crore shares of a face value of Rs 2 each of MFS fully paid-up on a preferential basis to MSI, the company said in a regulatory filing.
The transaction will also provide MFS an option to purchase from MSI, its balance shareholding of 5.24 per cent of the equity share capital of Max Life for cash at a price of Rs 80.89 per share.
The transaction structure will involve MSI subscribing 7.35 crore shares of MFS having a par value of Rs 2 each at a price of Rs 421.67 per share aggregating to 21.45 per cent of the paid-up equity share capital of the company on the date of allotment of the aforesaid fresh shares.
In consideration, MFS will receive 38.33 crore shares of Rs 10 each from MSI at a price of Rs 80.89 per share translating into 19.98 per cent stake of MLIC.
Pursuant to this, the equity stake held by MFS in Max Life will increase from 71.79 per cent to 91.77 per cent.
Shareholders of Max Financial Services also approved increase in authorised share capital of the company from Rs 60 crore to Rs 70 crore, it said.
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