Tuesday, September 19, 2017

Plan to merge three Indian insurers scrapped

India has scrapped the proposal to merge three small state-run insurers–Oriental Insurance, National Insurance, and United India Insurance–and instead asked the insurers to come up with a revival plan.

The three firms together hold 34% of the total market share. The merged entity would have fetched better valuations at the time of listing, according to sources.

With the merger plan being scrapped, sources said the government could consider listing the three insurers individually by 2019.

Last January, India approved the listing of five state-run general insurers and cutting the government stake in these insurers to 75%.

Earlier, India’s insurance regulator denied permission to the proposed merger of Max Life and HDFC Standard Life Insurance as it violates Section 35 of the country’s Insurance Act which bars the merger of an insurance firm with a non-insurance company.

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