Japanese insurance and mutual fund firm Nippon Life's proposal to acquire 26 per cent stake in Anil Ambani-owned Reliance Capital Asset Management Ltd (RCAM) has got a green signal from the Competition Commission.
The anti-monopoly body approved the proposal for combination after considering details of the notice for combination.
“The Commission is of the opinion that the proposed combination is not likely to have any appreciable adverse effect on competition in India and, therefore, approves the proposed combination,” CCI said.
In January this year, Nippon Life Insurance had picked up stake in RCAM, India's second largest mutual fund in assets, for close to Rs 1,450 crore. It is the largest investment by a foreign firm in India's mutual fund industry.
The transaction pegs RCAM's valuation at Rs 5,600 crore.
Nippon Life is a 122-year Global Fortune-100 company, and manages over $600 billion (Rs 30 lakh crore) in assets, among the largest total assets in the world for any life insurer.
‘No direct operation'
CCI said that Nippon Life, which is a global player in providing asset management and portfolio management services, has no direct operations or presence in India in the same space, except for a 26 per cent equity participation in Reliance Life Insurance Company Ltd, a subsidiary of RCap. RCAM manages around Rs 1.4 lakh crore assets.
“It is observed from the information available on the Web site of the SEBI that there are more than 40 other AMCs registered with the market regulator providing services similar to the asset management services provided by RCAM in India and there are more than 250 portfolio managers registered with SEBI providing similar services,” CCI said.