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AIA to raise stake in Tata AIA Life Insurance to 49%

Livemint:  December, 2015

Mumbai: Insurance firm AIA Group Ltd will increase its stake from 26% to 49% in Tata AIA Life Insurance Co. Ltd, a joint venture owned by Tata Sons Ltd and AIA Group, for an undisclosed amount.

Tata Sons and AIA said in a joint statement on Monday that they have reached an agreement under which AIA will increase its shareholding in Tata AIA Life Insurance from the current level of 26% to 49% by purchasing 23% additional stake in the company.

The companies did not disclose the valuation for the additional stake.

The completion of the transaction is subject to securing all necessary regulatory and governmental approvals, the statement said.

Tata AIA Life Insurance was licensed to operate in India on 12 February 2001 and started operations on 1 April 2001.

Hong Kong’s AIA Group has a presence in 18 markets in Asia-Pacific and is listed on the Stock Exchange of Hong Kong Ltd.

Last week, Sun Life Financial Inc. of Canada said it will increase its stake in Birla Sun Life Insurance Co. Ltd, a joint venture with Aditya Birla Nuvo Ltd, from 26% to 49% by spending Rs.1,664 crore to buy additional shares from the Indian partner.

According to data from Thomson Reuters, at least 19 deals were announced in the insurance sector between March and November, Mint reported on 3 December.

Foreign investors started ploughing in capital in their Indian counterparts after they were allowed to increase their stake from 26% to 49%.

Not all companies have disclosed deal values. A Mint analysis of deals where the value has been announced suggests that they add up to more than Rs.10,000 crore. The largest transaction was Japan-based Nippon Life Insurance Co. increasing its stake in Reliance Life Insurance to 49% from 26% for Rs.2,265 crore.