Nippon Life to acquire 26% stake in Reliance Life for $680 mn

New Delhi, Mar 14 (PTI) Japanese insurance firm Nippon
Life Insurance Company will acquire a 26 per cent stake in
Indian company Reliance Life Insurance for USD 680 million.
"Nippon Life Insurance will invest an aggregate value of
Rs 3,062 crore (USD 680 million) to acquire a 26 per cent
strategic stake in Reliance Life Insurance," the Anil Ambani
Group firm said in a statement today.
The transaction pegs the total valuation of Reliance Life
Insurance at approximately Rs 11,500 crore (USD 2.6 billion),
the statement said, adding that the transaction is subject to
necessary regulatory approvals.
Nippon is the 6th largest life insurer in the world and
the No. 1 private life insurer in Asia and Japan.
Commenting on the development, Reliance Capital Chairman
Anil Ambani said, "At this time, our thoughts are with the
people of Japan, bravely facing an unprecedented natural
catastrophe. We pray for strength to the country, its people
and our new partners in the entire Nippon Life family, to
overcome the trauma of the tragic loss of life and devastation
caused by this calamity."
Reliance Capital currently holds a 100 per cent stake in
Reliance Life.
"We both share the same passion and philosophy and,
together, we believe we can develop a strategic partnership to
help Reliance Life Insurance become a world-class insurance
company in India," said Nippon Life Insurance President Kunie
Okamoto.
Shares of Reliance Capital were up 5.46 per cent at Rs
538.75 on the BSE at 1116 hours.
As per the current rules, a foreign entity can hold up to
a 26 per cent stake in an Indian insurance firm. Reliance
Capital wholly owns Reliance Life, a business it acquired from
AMP Sanmar in 2005.
Reliance Life is the largest insurer amongst the 22
private life insurers in India in terms of the number of
individual policies sold.
The company has sold over 7 million policies through its
network of nearly 1,250 offices and over 2,15,000 advisors.
Reliance Life managed assets of over Rs 17,000 crore (USD 3.7
billion) as of December 31, 2010.
Commenting on the deal, Reliance Capital CEO Sam Ghosh
said, "As a strategic partner, Nippon Life will bring vast
experience, expertise and global best practices in areas of
product development, underwriting, investment management,
distribution, customer relationship management and risk
management."