Nippon in talks to raise stake in Reliance Life after FDI hike

Sep 04 2014, 01:12 IST
Comments 0
SummaryNippon Life currently holds a 26% stake in Reliance Life, which it had bought for Rs 3,062 crore. This deal was completed in October 2011 and it had valued the Indian insurer at over R11,500 crore at that time

Japanese giant Nippon Life is in talks to increase its stake in India's leading private insurer, Reliance Life, as soon as the government allows higher FDI in the sector.

Nippon Life currently holds a 26% stake in Reliance Life Insurance Company, which it had bought for R3,062 crore. This deal was completed in October 2011 and it had valued the Indian insurer at over R11,500 crore at that time.

The government has now proposed to hike FDI cap in insurance sector from 26% to 49%. The proposal was cleared by the Union Cabinet in July this year and the government has said it is hopeful of its passage in Parliament.

Reliance Life, which is part of Anil Ambani-led business conglomerate Reliance Group's financial services arm Reliance Capital, has expanded its partnership with Nippon Life even further and also adopted certain business models of Japanese insurance giant in its practices here.

Nikkei business daily quoted Reliance Group MD Amitabh Jhunjhunwala as saying that "the two sides (Nippon Life and Reliance Life) are in talks and will likely seal the deal (for hike in stake) as soon as the legislation raising caps on foreign investment in Indian insurers passes".

Jhunjhunwala, who was here for a new partnership between Nippon Life and Reliance Capital AMC, further said that the Reliance Group "welcomes additional investment by Nippon Life".

At a time when Prime Minister Narendra Modi is on his first official visit to Japan, Nippon Life has launched two India-focussed funds to facilitate direct investments by Japanese retail investors into Indian markets.

Ads by Google
Reader´s Comments
| Post a Comment
Please Wait while comments are loading...