HDFC has announced that it will sell a 9 per cent stake in HDFC Life Insurance to its British joint venture partner Standard Life for a little over ₹1,700 crore.
The transaction — once approved by Indian regulators — would lead to Standard increasing its stake in HDFC Life to 35 per cent from the current 26 per cent. HDFC’s shareholding in the joint venture will fall to 61.65 per cent.
Under the deal, Standard Life will pick up 17.5 crore shares at ₹95 apiece, said a press statement issued by HDFC.
The Centre recently hiked foreign investment limit in the insurance sector to 49 per cent from the earlier 26 per cent.
Commenting on the development, HDFC Chairman Deepak Parekh said he was delighted that Standard Life was increasing its stake in HDFC Life to 35 per cent.
“The founding shareholders are also committed to obtaining a listing for HDFC Life. This will also allow investors to participate in the growing Indian insurance sector,” he said.
Keith Skeoch, CEO of Standard Life Plc, said: “Today's announcement marks a strengthening of our well established relationship with HDFC. The proposed investment demonstrates our long term commitment to India and the future success of HDFC Life.”
HDFC Life Insurance, launched in 2000, was the first private life insurer to be granted a licence to operate in India.