Max Financial Services Ltd (MFSL) on Wednesday said the Insurance Regulatory and Development Authority of India (IRDAI) has given its approval for the acquisition of up to 12 per cent stake in Max Life Insurance by Axis Bank and its subsidiaries Axis Capital and Axis Securities (together Axis entities).
As per the proposed transaction, Axis entities have the right to acquire up to 19 per cent stake in Max Life; of which, Axis Bank proposes to acquire up to 9 per cent. Axis Capital and Axis Securities together propose to acquire up to 3 per cent of the share capital of Max Life in the first leg of the transaction, according to a statement.
In addition, Axis entities have the right to acquire an additional stake of up to 7 per cent in Max Life, in one or more tranches, which they intend to acquire over the course of the next few years, it said.
"We have been looking forward to bringing Axis Bank in this construct as a joint venture partner in Max Life.
"Our long and successful business association with them has demonstrated to us their value across customer insights, distribution expertise and other functional benefits which will be highly useful for the business," Max Group and Max Financial Services Chairman Analjit Singh said.
MFSL Managing Director Mohit Talwar said, "We hope we will be able to make quick progress in harnessing the synergies and benefits from this joint venture between Max Life and Axis Entities." The approval from the insurance regulator was an integral step in this joint venture transaction which was first announced in April 2020, the statement said.
MFSL, a part of Max Group, owns and actively manages a 93.1 per cent stake in Max Life Insurance.