Max seeks more from NY Life for 49% stake

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Mumbai, Jul 21: Indian promoters in insurance joint ventures are making their foreign partners change the terms in the original agreement. The promoters, who had agreed to allow their foreign allies to increase their stake in the joint ventures from 26% to 49% at a lower price, are now demanding much higher prices in line with the current valuations.

Max India has restructured some of the terms for its partner, New York Life, for raising its stake in joint venture Max New York Life. Modifying the earlier terms of options available to New York Life for purchase of 24% stake in the life insurance joint venture, as and when the regulations permit, New York Life will have to pay the price on a “fair market value-based formula”, which will include a discount of 10%. This is against the earlier preferential arrangement that was linked to the face value of the share.