HDFC to sell its 9 percent stake in HDFC life to JV partner Standard Life for Rs. 1700 Crore
HDFC has announced to sell its 9 per cent stake in HDFC Life Insurance to its British joint venture partner Standard Life for sum of 1,700 crore rupees.
Prior this agreement HDFC had 70.65 per cent stake while Standard life had 26 per cent stakes which will be change to 61.65 per cent and 35 per cent respectively.
This move was taken in line to increase the role of its foreign partner which followed the Centres approval to hike FDI to 49 per cent from 26 per cent in Insurance sector.
As per the agreement HDFC will issue 17.5 crore shares at the rate of Rs. 95 per share to Standard life.
Note: HDFC life in a Joint venture between HDFC and Standard life launched in 2000 and is the first private life insurer to be granted a licence to operate in India.
Key Facts of Insurance sector in India:
- There are over 52 insurance companies in India out of which 24 are in life insurance business and 28 are non-life insurers.
- Life Insurance Corporation (LIC) is the sole public sector company among Life Insurance Company and there are six public sector insurers among non-life insurers.
- Apart from that there is sole national re-insurer the General Insurance Corporation of India (GIC).
- The market size of India’s Insurance sector is 70 billion US dollars.
- Kotak Mahindra Bank is the first bank to set wholly-owned non-life insurance company.
- As per Pradhan Mantri Jan Dhan Yojana even the Zero balance account opened prior to August 28, 2014 get Rs 1,00,000 insurance cover.
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Month: Current Affairs - August, 2015