Insurance Regulatory and Development Authority of India (IRDAI) has given its formal approval to Axis Bank and its subsidiaries -- Axis Capital Limited & Axis Securities Limited – to acquire up to 12 percent stake in Max Life Insurance.

In January this year, the Competition Commission of India (CCI) had approved the stake acquisition.

Max Life said in release, as per the proposed transaction, Axis Entities have the right to acquire up to 19 percent stake in Max Life, of which, Axis Bank proposes to acquire up to 9 percent, and Axis Capital Limited and Axis Securities Limited together propose to acquire up to 3 percent in the first leg of the transaction. Axis Entities have the right to acquire an additional stake of up to 7 percent in Max Life over the next few years.

Analjit Singh, Chairman of Max Group and Max Financial Services said, "We have been looking forward to bringing Axis Bank in this construct as a joint venture partner in Max Life. Our long and successful business association with them has demonstrated to us their value across customer insights, distribution expertise and other functional benefits which will be highly useful for the business. I am confident that this joint venture will strengthen our position as a top leader in the Indian Life Insurance sector which is showing clear indications of rapid and enduring growth."

In October 2020, the Reserve Bank of India (RBI) overruled Axis Bank's initial proposal to raise the stake to 29 percent and pared it to an aggregate of 19.02 percent.

The private sector lender planned to buy 29 percent stake in the insurer, but changes had to be made in the deal following communication with IRDAI.

First Published:Feb 24, 2021 9:36 PM IST