The domestic insurance sector is witnessing a flurry of M&A activity and ET NOW learns that a mega deal is brewing in one of India’s youngest life insurance companies, IndiaFirst Life Insurance which is a three-way joint venture between Bank of Baroda, Andhra Bank and UK’s leading risk,wealth and investment brand Legal & General group. According to two sources familiar with the proposed transaction who spoke on the condition of anonymity, the JV partners are currently exploring multiple strategic options which could include either a potential partial stake sale or even a potential exit based on the progress of the discussions.
” They ( JV partners) are considering various strategic options, but no plans have been finalised as yet by them. As part of preliminary negotiations , talks have been held with prospective suitors like Reliance Nippon Life Insurance,” said one of the two sources cited above.
” Ambit Capital has been roped in to advise on the strategic options suitable for each of the JV partners. For instance, Legal & General Group is reconsidering its emerging markets strategy & is believed to be eyeing an exit ,” added the second source cited above.
Launched in 2010 by the President of India, Mr. Pranab Mukherjee, IndiaFirst Life Insurance is headquartered in Mumbai and is present in over 1000 cities across India. The JV’s shareholding pattern is as follows – Bank of Baroda holds 44% stake, Andhra Bank holds 30% stake and Legal & General group holds 26% stake.
ET NOW is awaiting email responses to detailed queries sent to Bank of Baroda, Andhra Bank and Legal & General Group. Ambit Capital declined to comment on market speculation while IndiaFirst Life Insurance said , ” IndiaFirst Life has had a successful FY 2016-17, declaring INR 35 crores of profits and is on course to cross INR 50 crores of profits for the FY 2017-18. The shareholders are participative and supportive of the company’s plans. IndiaFirst Life Insurance has had no discussions with any insurance company, nor has appointed any advisor for any such arrangement.”