ICICI Lombard General Insurance to acquire Bharti AXA General Insurance

ICICI Lombard General Insurance acquisition of Bharti AXA General Insurance : Indian insurance companies ICICI Lombard and Bharti AXA have agreed to merge their general insurance businesses in an all-stock deal, in a move to create the third-largest non-life insurance company in India with nearly INR 164.47 billion ($2.2 billion) annual premium.

The merger of the two general insurance businesses will have a market share of about 8.7%, said ICICI Lombard.

ICICI Lombard will be acquiring all the shares of Bharti AXA’s general insurance business at INR 10 per share. This will be through the exchange of 115 of their shares by shareholders of Bharti AXA with two shares of ICICI Lombard.

AXA and Bharti will be issued a total of 35.8 million shares, worth €521 million, of ICICI Lombard on the closing of the deal.

Rakesh Bharti Mittal – Chairman of Bharti AXA General Insurance, commenting on ICICI Lombard General Insurance acquisition of Bharti AXA General Insurance, said: “We are delighted that the partnership between Bharti and AXA has been successful in laying down a solid foundation in the domestic insurance landscape. Over the past few years, our business demonstrated consistent growth, forged productive partnerships and increased the distribution footprint significantly.

“We are confident that the proposed amalgamation of our business with ICICI Lombard will bring greater business synergies and create value for all stakeholders.”

ICICI Lombard General Insurance acquisition of Bharti AXA General Insurance

The proposed merger is said to give a meaningful scope for ICICI Lombard to strengthen its market-leading position in the non-life insurance segment. Also, the company will be able to augment its strength in insurance distribution with the existing distribution partnerships of Bharti AXA.

The combined Indian general insurance entity will also benefit from continued partnerships with Bharti AXA’s parent firms – Bharti Enterprises, an Indian conglomerate, and French insurance giant AXA.

Commenting on ICICI Lombard General Insurance acquisition of Bharti AXA General Insurance, Bhargav Dasgupta – MD and CEO of ICICI Lombard General Insurance said: “This is a landmark step in the journey of ICICI Lombard and we are confident that this transaction would be value accretive for our shareholders. We are excited by the capabilities and strengths that Bharti AXA will add to our franchise.

“The company has a talented employee base with a strong cultural fit, and we look forward to welcoming them to the ICICI Lombard family. We would also like to reassure Bharti AXA’s policyholders and channel partners of seamless business continuity and maintaining highest standards of customer service.”

The closing of ICICI Lombard General Insurance acquisition of Bharti AXA General Insurance will be based on meeting various preceding conditions such as regulatory approvals from the Indian Insurance Regulatory and Development Authority (IRDAI), Competition Commission of India (CCI), The Securities and Exchange Board of India (SEBI), stock exchanges, Reserve Bank of India, and other regulators, apart from approval of shareholders of both ICICI Lombard and Bharti AXA.