Zurich Insurance Co. plans to buy a 70% stake in Kotak Mahindra General Insurance Co. for Rs 5,560 crore via primary and secondary acquisitions in a single tranche.
Initially, Zurich Insurance will acquire a 51% stake in the domestic insurer through a combination of capital infusion and share purchase, according to its exchange filing on Friday.
This will be followed by an additional stake acquisition of 19% within three years of the initial acquisition.
The remaining terms of the transactions remain unchanged, subject to approvals from the Reserve Bank of India and the Insurance Regulatory and Development Authority of India, it said.
The Union government increased the permissible foreign direct investment limit in Indian insurers from 49% to 74% and allowed foreign ownership and control with safeguards in 2021.
Under the new structure, the majority of directors on the board and key management personnel would be resident Indians, with at least 50% of directors being independent directors and a specified percentage of profit being retained as general reserve.
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