ICICI Lombard, Bharti AXA To Merge General Insurance Businesses
More investments expected to flow in the Indian insurance sector as IRDAI approves guidelines for PE Funds to become promoters. (Photographer: Akio Kon/Bloomberg)

ICICI Lombard, Bharti AXA To Merge General Insurance Businesses

ICICI Lombard General Insurance Co. Ltd. will acquire Bharti AXA General Insurance Co. Ltd.’s non-life insurance operations in a share swap deal, according to a company statement issued on Saturday.

Shareholders of Bharti AXA will receive two shares of ICICI Lombard for every 115 shares of Bharti AXA, as per the share exchange ratio recommended by independent valuers.

The companies, however, did not disclose the deal value.

Bharti Enterprises currently owns 51% stake in Bharti AXA General Insurance, while French insurer AXA has 49%. Meanwhile, promoter ICICI Bank Ltd holds is 51.89% stake in ICICI Lombard, while the rest is with the public. After the proposed deal, promoter stake will come down to 48.11%.

We would also like to reassure Bharti AXA’s policyholders and channel partners of seamless business continuity and maintaining highest standards of customer service."
Bhargav Dasgupta, CEO, ICICI Lombard

The proposed merged non-life insurance company is expected to earn a total annual premium of at least Rs 16,447 crore on a combined basis with market share of around 8.7%, said the two companies in a joint media release.

Bharti Enterprises has been trying for a long time to exit its financial services business. In 2016, Bharti Enterprises' talks with Reliance Industries to sell its 74% stake in Bharti AXA Life Insurance and Bharti AXA General Insurance could not reach the logical conclusion.

For the fiscal year ended March 2020, Bharti AXA General Insurance reported a 38% increase in its gross premium collection to Rs 3,157 crore as against Rs 2,285 crore in 2018-19.

BQ Install

Bloomberg Quint

Add BloombergQuint App to Home screen.