Privately-owned insurer Max New York Life on Wednesday announced that it would sell 4 per cent stake to its banking partner Axis Bank.
''We will dilute 4 per cent stake to our bancassurance partner Axis Bank. We have already received approval from Insurance Regulatory and Development Authority (IRDA) to carry out this process soon,'' Max New York Life managing director and chief executive Rajesh Sud told newspersons in Mumbai.
''Similarly, Axis Bank has also received the Reserve Bank's approval to purchase the stake from the private insurer,'' Sud said, adding that the dilution deal will further strengthen its capital requirement.
A spokesperson from Axis Bank said the bank has received necessary regulatory approval for the investment.
Sud declined to comment on the financial details, saying the embedded valuation would be disclosed by the end of this month or June. However, a report puts the size of the deal at Rs72 crore.
Max New York Life Insurance Co is a 74:26 joint venture between the Analjit Singh's Max India and New York Life International, a Fortune 100 company and the international arm of New York Life.
Max New York Life Insurance is a 74:26 joint venture between Analjit Singh's Max India and US-based New York Life International. It has a share base of 180 crore with a paid-up capital worth Rs1,976 crore as at the end of March 2011.
The company reported a net profit of Rs283 crore in the financial year 2010-11 compared with Rs24 crore a year ago.