The fair trade watchdog, Competition Commission of India, approved the subscription of 16.22 per cent equity shares of Max Life Insurance Company by Axis Bank Limited on 02-04-2024.
The news of the transaction involving Axis Bank’s stake in the private life insurer’s company was first revealed by the insurer in August 2023 whereas, the transaction received IRDAI’s nod in February this year.
Axis Bank is a private sector bank providing services in retail banking which includes retail lending and retail deposits, wholesale banking, payment solutions, distribution of mutual fund schemes, distribution of insurance policies, wealth management, forex and remittance products.
Max Life Insurance provides life insurance and annuity products and is also engaged in distribution of insurance policies.
The capital infusion by the Bank would improve the insurer’s solvency margins, augment it’s capital position and support its future growth perspectives.
As per the summary by CCI , the deal leads to the horizontal overlap of the life insurance market, the market for management of non-governmental pension fund assets under the National Pension System (‘NPS’) and NPS’s enrolment and distribution as well. The acquisition also leads to a vertical overlap, upstreaming the market for life insurance products and management of non-governmental pension fund assets under NPS and down streaming of the distribution of life insurance market, the market for enrolment and distribution of NPS and the market for provision of annuity services in India.
The Bank got the right to appoint/nominate two directors in addition to the existing three along with an option to acquire certain equity shares, directly or indirectly, of up to 0.98 per cent within the first 42 months of the acquisition.
Source: Press
