IDBI Bank has executed a pact to sell up to 27 percent of its stake in IDBI Federal Life Insurance (IFLI) to its joint venture partners Ageas Insurance International and Federal Bank. It is said that it expects to receive up to 595.30 crores from the sale.
At present, IDBI Bank holds a 48 percent stake in IFLI.
Post completion of the transaction, subject to regulatory approvals, Ageas and Federal Bank stake would be at 49 percent and up to 30 percent, respectively, in IFLI and IDBI Bank stake would be at least 21 percent in IFLI, IDBI Bank said in a statement on August 6.
According to the agreement, a 23 percent stake would be sold to Ageas, Federal Bank would acquire up to 4 percent stake in IFLI from IDBI Bank. For 23 percent stake sale to Ageas, the bank will receive 507.10 crores. For up to 4 percent stake sale to Federal Bank, IDBI Bank will receive up to 88.19 crores. The transaction would be concluded subject to regulatory approvals.
The transaction is expected to be completed by the end of October-December, Financial Year 2021, dependent on the regulatory approvals and satisfaction of the terms and conditions set out in the SPA, the bank said in a regulatory filing.
IDBI Federal Life Insurance received its license from IRDAI in December 2007 and started operations in 2008. It reported a 22 percent increase in its net profit to 162 crores in 2019-20.
