Bajaj Group To Buy 26% Stake In Insurance JVs From Allianz In $2.80 Bln Deal
The deal will end 24-year-old alliance and Bajaj Group would gain full ownership of Bajaj Allianz General Insurance and Bajaj Allianz Life Insurance
(The Corner Office Journal) -- Bajaj Group agreed to acquire a 26% stake owned by Allianz SE in their insurance businesses to gain full ownership in a deal valued at 24,180 crore rupees ($2.80 billion).
The agreed consideration for 26% stake in Bajaj Allianz General Insurance Company (BAGIC) and Bajaj Allianz Life Insurance Company (BALIC) is 13,780 crore rupees and 10,400 crore rupees, respectively, the diversified financial services group said in a stock exchange announcement.
Under the terms, Bajaj Finserv will acquire about 1.01% stake, Bajaj Holdings and Investment Ltd. around 19.95% stake and Jamnalal Sons Private Ltd. about 5.04% stake, aggregating to 26% stake in each of the insurance companies.
Bajaj Finserv, a part of Bajaj Group, will own a 75.01% stake each in BAGIC and BALIC post-acquisition.
The stake acquisition in BAGIC and BALIC will increase Bajaj Group’s ownership in these companies to 100% from the current 74%.
Bajaj Finserv said the 24-year-old joint venture agreements between the group and Allianz related to the insurance businesses will stand terminated upon the completion of the first tranche of acquisition of at least 6.1% stake and reclassification of Allianz from being a promoter to investor category.
Bajaj Group and Allianz plan to independently pursue their insurance strategies in India following the termination of the joint ventures, it added.
The acquisition is subject to regulatory approvals, including from the Competition Commission of India and the Insurance Regulatory and Development Authority of India.
Bajaj Finserv and Allianz also entered into agreements that will ensure continuity of reinsurance and other services during the transition.
Note: $1 = 86.8138 Indian rupees
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