Max Financial Services Limited (MFSL) on Wednesday said that it has concluded the swap of Mitsui Sumitomo Insurance Company’s (MSI) 20.57 per cent stake in Max Life Insurance Company Limited (Max Life), with 21.87 per cent stake in MFSL.
In a filing with the stock exchanges, MFSL said it has allotted 7,54,58,088 equity shares of ₹2 each constituting 21.87 per cent of the paid-up share capital to MSI, on a preferential allotment basis.
The allotment to the joint venture partner MSI is in consideration for the transfer of equity shares constituting 20.57 per cent of the paid-up share capital of Max Life held by it to MFSL.
Post this allotment, the paid-up equity share capital of MFSL stands increased to ₹69,00,65,184 and will effectively increase MFSL’s stake in Max Life to 93.10 per cent. Prior to the allotment, MFSL held a 72.5 per cent stake in Max Life and MSI owned 25.5 per cent stake.
Commenting on the development, Mohit Talwar, MD, MFSL and Vice Chairman, Max Group, said in a statement, “We thank Mitsui Sumitomo Insurance for their long-standing partnership. I am sure they will continue to contribute richly to Max Financial through their Board participation.”
Welcoming the share swap transaction, MSI said, “We have had a long and mutually beneficial joint venture with Max. We continue to have a strong conviction in the potential of Max Financial, through its subsidiary Max Life. We believe that the anticipated Max Life-Axis JV will improve the prospects of this high-quality life insurance franchise even further.”
The Board of MFSL has also appointed MSI’s two nominees, Hideaki Nomura and Mitsuru Yasuda as non-executive non-independent directors on the Board of MFSL.
It may be recalled that MFSL had on November 28 disclosed that it has received approval from the Insurance Regulatory and Development Authority of India (IRDAI) for the proposed swap of 20.57 per cent stake in Max Life held by MSI to MFSL in exchange for 21.87 per cent stake in MFSL.