Nippon invests $348 million in Reliance, increases stake to 49%
Nippon Life Insurance (NLI), a Japan-based Fortune 500 company, on Tuesday said that it will increase its stake in its Indian joint venture with Reliance Life Insurance (RLIC) from the existing 26% to 49%Nippon Life Insurance (NLI), a Japan-based Fortune 500 company, on Tuesday said that it will increase its stake in its Indian joint venture with Reliance Life Insurance (RLIC) from the existing 26% to 49%. The Japanese insurance giant will invest $348 million (Rs.2,265 crore) to acquire additional 23% in Reliance Life Insurance. With the latest transaction, Reliance Life Insurance’s total market valuation climbs up to $1.5 billion (Rs.10,000 crore), the highest for any life insurance company in India. “Nippon Life Insurance’s investment also represents an implied Embedded Value (EV) multiple of over 3 times for Reliance Life Insurance, the highest for any private insurer in India till date,” Reliance Capital Ltd. said in a statement. The transaction takes Nippon Life Insurance’s aggregate investments to ($819 million (Rs.5,327 crore) for acquiring 49% stake in Reliance Life Insurance. NLI has also agreed to invest $508 million (Rs.3,303 crore) to acquire 49% stake in Reliance Capital Asset Management. The deal, once completed, will take its total investment to $1.3 billion (Rs.8,630 crore), the largest FDI in India’s financial services sector. As per the new shareholding structure, the name of the company will be changed to Reliance Nippon Life Insurance Company Ltd. “We are delighted that the outstanding relationship between our two companies has now grown into an equal partnership, with NLI increasing their stake – first, in our asset management business, and now, in our life insurance business – to 49%,” said Anil D Ambani, Chairman, Reliance Group.
November 24, 2015 |5:12pm IST
to success.