Thursday, December 14, 2017

HDFC Standard, Max Life call off proposed merger

Failing to secure regulatory approval in India, HDFC Standard Life and Max Life have formally cancelled their merger plans.

The proposed union would have led to the creation of an insurance giant with assets valued at Rs1.1 trillion (US$17 billion).

Max Financial Services, Max India and Max Life have confirmed the cancellation.

Max said the exclusivity agreement with HDFC Life was valid until July 31 and is not set to be renewed.

The insurance regulator referred the proposal to the law ministry after raising concerns about its structure.

Max Financial Services was established in 2016, following a demerger of the erstwhile Max India.

The two firms had initially planned the merger of Max Life with Max Financial Services.

But this was found to be a violation of the Insurance Act, which prohibits the merger of an insurance company with a non-insurance firm.

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