MUMBAI: The Insurance Regulatory and Development Authority of India has approved the entry of a third Indian investor, holding 26% in Reliance Nippon Life, Reliance General and Reliance Health insurance companies, a move that clears the way for IndusInd International Holdings (
IIHL
) to acquire Reliance Capital.
In terms of the deal approved by the IRDAI, Reliance Capital will transfer 26% equity in Reliance Nippon Life and other two insurance companies to Aasia Enterprises, an Indian entity promoted by
Ashok Hinduja
.
After this, Reliance Capital,
Nippon Life Insurance
, and
Aasia Enterprises
LLP will be the promoters of the life company.
IIHL has acknowledged the receipt of approval from IRDAI on 10th May 2024. However, the approval is subject to certain “regulatory, statutory, and judicial” clearances/compliances. “The approval is subject to certain ‘regulatory, statutory, and judicial’ clearances/compliances. IIHL stands committed to working towards obtaining the same as soon as possible and aims to close this transaction by the NCLT’s stipulated date of the 27th of May 2024,” the company said in a statement.
IRDAI clearance is subject to approval from other regulatory bodies, a lock-in for the new investor, continuous fit and proper assessment of insurer, promoter, and investors, and a bar on the shares of the insurance company being pledged. The regulator has stated that the approval is subject to the deal being completed in three months.
IIHL, chaired by Ashok Hinduja, placed the winning bid of Rs 9661 crore for Reliance Capital in the
bankruptcy process
. However, the deal was held up because of the
IRDAI approval
. The bulk of the value of Reliance Capital lies in its 100% holding of
Reliance General Insurance
and 51% in Reliance Nippon Life Insurance.
