HDFC Life Insurance on Friday announced that its board has approved the acquisition of 100% of the share capital of Exide Life Insurance Company Ltd for a total consideration of Rs 6,687 crore. Exide Life will be subsequently merged into HDFC Life.
Out of the aggregate amount, HDFC Life will pay Rs 725 crore in cash and the balance via issuance of over 8.70 crore equity shares at an issue price of Rs 685 per share to holding company Exide Industries Ltd. Exide Industries divested the entire equity shareholding held by the company in Exide Life.
Vibha Padalkar, MD and CEO, HDFC Life said, “We believe that the transaction can result in value creation for customers, employees, shareholders and distribution partners. This transaction will provide an opportunity for HLIC and the Target (Exide) to realise synergies arising out of complementary business models.”
While the insurer said that the acquisition is expected to complete by June 30, 2022, it added that the completion of the acquisition is subject to customary conditions such as receipt of regulatory and other such approvals. Once the deal is completed Exide Life Insurance will be merged into HLIC, the process for which will be started after the completion of the acquisition.
“This transaction is testimony to the reputation that Exide Life insurance has built of being a well-managed company. We look forward to working closely with the HDFC life team on the proposed transaction. Being part of one of India’s most respected life insurance companies will certainly benefit all our stakeholders,” said Kshitij Jain, MD and CEO, Exide Life Insurance.
AZB & Partners was the legal advisor to HDFC Life while Trilegal served as the legal advisor to Exide Life and Exide Industries. Deloitte Touche Tohmatsu India LLP and Rashmi Shah FCA (Registered Valuer) were hired as valuers for the transaction by HDFC Life, and Desai Haribhakti & Co, CAs and S Sundararaman (Registered Valuer) were appointed as valuers by Exide Industries.
Source: Economic Times