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Axis Bank’s board has approved the purchase of an additional 29% stake in Max Life Insurance, which will raise the private lender’s total stake in the insurer to 30%. Max Financial Services currently owns a 72.5% interest in Max Life and Mitsui Sumitomo Insurance (MSI) has a 25.5% interest. Axis Bank also has a minor stake in the life insurer. Axis Bank is the third largest private bank and Max Life is the fourth largest private life insurer in India.
After the completion of the series of transactions, Max Life will become a 70:30 joint venture between Max Financial Services and Axis Bank. Proposed transactions are subject to the approval of the required corporate and regulatory authorities.
Max Life Insurance Company had a turnover of ₹Rs 19,987 million in 2019.
Axis Bank expects the transaction to complete in six to nine months, subject to regulatory approvals.
Axis Bank and Max Life Insurance have had a successful business relationship for over a decade, providing savings and long-term protection products to more than 19 lakh clients. The total premium generated through this relationship has been added to more than Rs. Rs 38 billion.
Announcing the transaction, Amitabh Chaudhry, MD and CEO Axis Bank said: “We continue to believe in the long-term prospects of India’s low-penetration life insurance space, despite the current environment. We see that this joint venture creates immense value for our stakeholders given our long-lasting, high-performance partnership with Max Life. We believe this transaction will allow us to deepen our working relationship leading to better integrated teams and infrastructure and superior alignment in our approach. “
Analjit Singh, founder and president of Max Group, said: “I believe that at Axis we have found an exceptional partner and we are convinced that this will make Max Life fundamentally stronger, perform better and bring stability to the franchise. We will run the organization as if it were an equal partnership, a philosophy that has also kept us in a good position before. “
