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Standard Life insurance unit to take over rival overseas

Standard Life insurance unit to take over rival overseas

Standard Life insurance unit to take over rival overseas The Indian subsidiary of British investment and insurance firm Standard Life will take over Max Life Insurance, a leading competitor in the South Asian giant.
 
HDFC Standard Life Insurance has reached an agreement with Max Life Insurance, Max Financial Services and Max India Limited for the combination of the two life insurance businesses.
 
The companies, which started their deal talks in June, said HDFC Life shareholders would own 69% of the new Indian insurance business while Max Life shareholders will get 31%.
 
As part of the transaction, Max Life will merge into parent Max Financial Services, which will combine its life insurance business with HDFC Life, making it a publicly traded company.
 
The proposed transaction brings together two large life insurance players with complementary capabilities. It would create India’s top private life insurer valued at nearly US$10 billion, Reuters reported.
 
According to Max Life, the combined life insurance business will be a company with differentiated portfolio, wider reach and annual premium of 255 billion Indian rupees or US$3.8 billion.
 
The merged insurance entity will have a combined market share of 10.8%2, in an extremely competitive life insurance market.
 
The deal, which still needs shareholders’ and regulators’ approval, is expected to become effective in the next 12 to 15 months.
 
Standard Life CEO Keith Skeoch said the British finance giant will have “strategic stakes” in leading Indian life insurance and asset management companies because of the deal.
 
“Max Life's bancassurance relationships will complement HDFC Life's already strong distribution. If approved, we expect it to cement HDFC Life's position as the leading private sector Indian life insurance business,” Skeoch said.
 
According to Reuters, HDFC Life and Max Life are respectively the third and fourth biggest private sector life insurers in India at present.
 
 
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