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Bharti AXA General likely to merge with ICICI Lombard, deal pegged at Rs 2,600 crore

Bharti AXA General likely to merge with ICICI Lombard, deal pegged at Rs 2,600 crore

Bharti-AXA General is expected to merge with ICICI Lombard in an all-stock deal which values the former at Rs 2,600 crore

ICICI Lombard ICICI Lombard

Bharti-AXA General is expected to merge with ICICI Lombard in an all-stock deal which values the former at Rs 2,600 crore. The merger agreement is likely to be finalised once the requisite regulatory approvals are received.

French insurance and asset management company AXA has a shareholding of 49 per cent in the joint venture. The majority stake is held by Bharti Enterprises. AXA may exit the general insurance business after the completion of the deal, Moneycontrol reported citing unidentified sources.

In Q1FY21, the gross direct premium underwritten by Bharti-AXA General Insurance stood at Rs 508.92 crore, implying  a fall of 12 per cent as against the corresponding period of last year. In FY20, the company posted a 17 per cent growth in its renewal premium at Rs 1,359 crore compared to Rs 1,164 crore in FY19.

Meanwhile, ICICI Lombard recently reported 28.4 per cent rise in net profit at Rs 398 crore for June quarter of financial year 2020-21. The private sector non-life insurer had a net profit of Rs 310 crore in April-June 2019-20. Gross direct premium income (GDPI) of the company stood at Rs 3,302 crore in June quarter compared to Rs 3,487 crore in the year-ago period, a decline of 5.3 per cent Combined ratio - the metric to measure profitability and financial health of an insurance company - stood at 99.7 per cent in the June quarter of the current fiscal year compared to 100.4 per cent in the year-ago same period.

The insurance sector has recently seen a de-growth mainly due to the ongoing coronavirus pandemic.Also read: India may set up electronics commission to reduce dependency of manufacturers on China

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Published on: Jul 29, 2020, 12:14 PM IST
Posted by: Manali, Jul 29, 2020, 12:14 PM IST