The Insurance Regulatory and Development Authority of India (IRDAI) has approved the acquisition of up to 12 percent stake in Max Life Insurance Company by Axis Bank and its subsidiaries Axis Capital and Axis Securities.
The IRDAI approval was an integral step in this long-awaited joint venture transaction which was first announced in April 2020.
As per the proposed transaction, Axis entities have the right to acquire up to 19 percent stake in Max Life of which Axis Bank proposes to acquire up to 9 percent while Axis Capital and Axis Securities together propose to acquire up to 3 percent in the first leg of the transaction.
In addition, Axis entities have the right to acquire an additional stake of up to 7 percent in Max Life in one or more tranches which they intend to acquire in the next few years.
“I am confident that this joint venture will strengthen our position as a top leader in the Indian life insurance sector which is showing clear indications of rapid and enduring growth,” said Analjit Singh, Chairman of Max Group and Max Financial Services.
Max Life is the fourth largest private life insurer in India while Axis Bank is the third-largest private bank. The two companies have shared a successful business relationship for over a decade, providing long-term saving and protection products to nearly 20 lakh customers.
The total premium generated through this relationship has aggregated to over Rs 40,000 crore.