Shiv Nadar-controlled HCL may buy out stake in DLF Pramerica Life Insurance Company
PrintListen to this Article
The Shiv Nadar-controlled HCL Group is in advanced discussions with real estate major DLF to acquire a substantial stake in DLF Pramerica Life Insurance Company Limited , for around Rs.450 crore in a two-phase transaction.
The acquisition will be done through a privately-held company and will represent Nadar's first diversification outside the IT business. Nadar set up HCL in 1976 and the two listed IT companies of the group - HCL Technologies and HCL Infosystems - have a combined market capitalisation of Rs.35,828 crore or $8 billion.
While spokespersons for both HCL and DLF declined comment, a person with direct knowledge of the talks said the HCL group company will first acquire a 44% stake in the insurance joint venture by buying fresh shares of the company and at a later stage, buy out DLF's residual 30% stake in the company, subject to approval of regulator Irda.
Regulatory Hurdle
At present, DLF holds 74% stake in the joint venture with Prudential Financial, the second-largest life insurer in the US, holding the remaining 26%. DLF's share holding in the insurance joint venture will fall to 30% after HCL's investment.
The transaction could face a possible regulatory hurdle as current guidelines stipulate that the original partner in a life insurance joint venture cannot sell its stake in the company during the first ten years of operations.
Last month, Reliance Industries announced that it was buying Bharti's entire stake in Bharti AXA Life Insurance , and if the insurance regulator gives the goahead for that sell-off, it will smoothen the way for this transaction as well. "Given an option, DLF would like to sell its entire holding in shot," said the person involved in the transaction. (ET)
Category : Merger & Acquisitions | Comments : 0 | Hits : 332
Punjab National Bank (PNB) may be centre of the next round of PSU bank merger in September where the Delhi-based lender could take some smaller PSU banks under its ambit. The names of Syndicate Bank, Oriental Bank of Commerce, Andhra Bank and Allahabad Bank are being considered for the merger. Sources said the move would add muscle to a big bank like PNB, which has just emerged from a dark phase of fraud by diamond merchant Nirav Modi and also has posted handsome profits. The lender could ...
The government is soon likely to invite select lenders for discussion on a second round of merger in public sector banks, according to a finance ministry official. The lenders to be called may include Punjab National Bank (PNB), Union Bank of India and Bank of India (BoI). “We wouldn’t like to wait for too long,” said the official, indicating that some merger activity is on the cards around second or third quarter of the current fiscal year. “If the bank...
State-owned Bank of Baroda (BoB) is likely to complete the process of merger of Dena Bank and Vijaya Bank with it in two years, said a senior official of BoB. The merger of Dena Bank and Vijaya Bank with BoB became effective from April 1. Information technology platform integration alone will take about 12 months and other processes and systems may take another year or so, the official said. The process has been designed to ensure that there is minimum disruption of the customers during th...
The board of Lakshmi Vilas Bank on Friday approved the merger of the private sector lender with Indiabulls Housing Finance (IBH) through a share swap deal. The merger will help Indiabulls get access to low-cost stable funds and an entry into banking. The company, the nation’s second largest housing finance firm, had unsuccessfully applied for a banking licence in 2013. The merger will also enable Tamil Nadu-based LVB to obtain a larger geographical presence. The merged entity will ha...
Bank of Baroda on Wednesday said the merger of Dena Bank and Vijaya Bank with itself would be effective from April 1 as per the scheme of amalgamation approved by the government. Besides, the board of the bank fixed March 11, 2019, as record date for issuing and allotting equity shares of the Bank of Baroda to the Shareholders of Vijaya Bank and Dena Bank. This scheme may be called the Amalgamation of Vijaya Bank and Dena Bank with Bank of Baroda Scheme, 2019, BoB said citing the governmen...
Comments