Munich Re, the German health and reinsurance company, has picked up an additional 23.3% stake in Apollo Munich Health Insurance Company for Rs 163.5 crore.
Apollo Munich Health Insurance is a joint venture between Apollo Energy Company (an arm of Apollo Hospitals group) and Munich Re.
As a result, Munich Re’s stake in Apollo Munich Health Insurance will rise to 48.7%, said a press release. The proposed transaction values Apollo Munich at Rs 703 crore and the deal is expected to be finalised in the first quarter of 2016. Axis Capital acted as the financial advisor to Apollo Hospitals group for the transaction.
Munich Re’s decision to increase its shareholdings comes in the wake of the government’s decision to increase the foreign direct investment cap in the insurance sector from 26% to 49%.
With the increase in shareholding, Munich Re strengthens its presence in India, one of the key markets for the company.
Prathap C Reddy, chairman of Apollo Munich Health Insurance Company, and chairman of Apollo Hospitals Enterprise, said, “Insurance is a key element for making quality healthcare facilities accessible to the masses. The show of confidence from our JV partner will go a long way in helping the group achieve its vision of healthcare for all.”