(For representation) A man walks past a billboard of Indian insurer ICICI Lombard in Mumbai. REUTERS/Shailesh Andrade – RC15831CAA30
Bharti Enterprises currently owns 51 per cent stake in Bharti AXA General Insurance, while French insurer AXA has 49 per cent.
- PTI
- Last Updated: August 22, 2020, 11:35 AM IST
The board of ICICI Lombard General Insurance “at its meeting held on August 21, 2020, considered and approved a ‘scheme of arrangement’ amongst Bharti AXA General Insurance (demerged company) and former company and their respective shareholders and creditors”, the ICICI Bank promoted non-life insurer said in a late night filing on Friday.
Based on the share exchange ratio recommended by independent valuers and accepted by the respective boards of ICICI Lombard and Bharti AXA, 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 on which the ‘scheme of arrangement’ is approved by the board of ICICI Lombard and Bharti AXA, a joint statement said.
The consolidation is beneficial for and in the interest of the policyholders as the demerger creates a more robust and financially strong insurer that can offer a wider product suite, more access points and comprehensive services to customers post completion of the scheme, it said.
“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 about 8.7 per cent on pro-forma basis,” the statement said.
The companies, however, did not disclose the deal value. The board approved the proposed scheme of demerger subject to all applicable statutory and regulatory approvals including from Insurance Regulatory and Development Authority, Competition Commission of India, stock exchanges, SEBI, shareholders and creditors of the companies involved in the scheme and the relevant jurisdictional benches of the National Company Law Tribunal, the filing said.
“We would also like to reassure Bharti AXA’s policyholders and channel partners of seamless business continuity and maintaining highest standards of customer service,” ICICI Lombard CEO Bhargav Dasgupta said.
Bharti Enterprises has been trying for a long time to exit its financial services business. In 2016, Bharti Enterprises’ talks with Reliance Industries to sell its 74 per cent stake in Bharti AXA Life Insurance and Bharti AXA General Insurance could not reach the logical conclusion.
For the fiscal year ended March 2020, Bharti AXA General Insurance reported a 38 per cent increase in its gross premium collection to Rs 3,157 crore as against Rs 2,285 crore in 2018-19.
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