India’s largest private non-life insurer, ICICI Lombard General Insurance Co. Ltd. and Bharti AXA General Insurance Co. Ltd., had announced on Saturday, that they will combine their insurance businesses through a share swap deal, the deal will result in the entity to be the country’s third-largest general insurance company.
Earlier on 11 August, it was reported that ICICI Lombard General Insurance is in advanced talks to merge the insurance assets of Bharti AXA General Insurance by acquiring it. Further, the board meeting held on Friday, a scheme of arrangement has been approved with Bharti AXA General Insurance Company. Under which, ICICI Lombard would be acquiring Bharti AXA General Insurance.
On the recommendations of the independent valuers, the share exchange ratio for the shareholders of Bharti AXA Insurance will be two shares of ICICI Lombard for every 115 shares of Bharti AXA. Currently, in Bharti AXA General, Bharti Enterprises holds 51% of the stake, while its France-based JV partner, AXA has 49%. Bharti and AXA will be allotted the equity shares of Rs 10 apiece of the combined entity and, the shareholders of Bharti will be receiving 18.23 million shares and 17.52 million shares will be received by the shareholders of AXA.
ICICI Bank Ltd., the promoter of ICICI Lombard holds a stake of 51.89% in ICICI Lombard, and after a proposed deal of Bharti AXA, the promoter would be holding a stake of 48.11%. The two companies said in a joint media release that it the company is expecting to earn a total annual premium of at least Rs 16,447 crore, with a market share of nearly about 8.7% on a combined basis.