Anil Ambani snaps up AMP Sanmar

01 August 2005

AMP Sanmar finds a buyer for the stakes of its two promoters, while Anil Ambani's Reliance Life, without ever having sold a policy, acquires a running business. Venkatachari Jagannathan reports.

Chennai: Anil Ambani's Reliance Life Insurance Company Limited, a subsidiary of Reliance Capital Limited, has concluded a much awaited deal in the life insurance sector.

Even before selling a single life insurance policy, Reliance Life, a part of the Anil Dhirubhai Ambani Enterprises, has snapped the Chennai-based private life insurer AMP Sanmar Life Insurance Company Limited. AMP Sanmar is a 26:74 joint venture between AMP, Australia and Sanmar group.

Interestingly, only recently, the Reliance Life had approached the Insurance Regulatory and Development Authority (IRDA) to revive its business licence that had been cancelled by the regulator for non commencement of business.

Though the three parties to the deal — Reliance Capital, AMP and Sanmar — are keeping the deal size secret, figures ranging between Rs225-400 crore are being talked about as being the final price.

What is clear is that Reliance Life has clearly outbid other suitors like Aviva, ICICI Prudential Life Insurance Company, etc. This acquisition makes Reliance Life the first private sector life insurer to start business without a foreign partner.

The deal gives Reliance Life a jumpstart as AMP Sanmar has around 90 branches, 900 staff and 9,000 agents. Further, AMP Sanmar is doing relatively good business even after the sale announcement. Till this July the company has earned a premium income of around Rs35 crore.