UK's Bupa to acquire another 23% in Max Bupa for Rs191 cr
24 November 2015
Max Bupa Health Insurance on Monday announced that its UK parent Bupa has executed agreements to acquire an additional 23 per cent stake in Max Bupa, one of India's leading standalone health insurers.
Bupa will pay around Rs191 cr. to Max India in an all cash transaction, to increase its stake in Max Bupa from 26 per cent to 49 per cent. Bupa was the first foreign insurer to announce its intent to increase its stake to 49 per cent in its Indian health insurance subsidiary after the government relaxed foreign direct investment rules for insurance companies.
Since that announcement in January 2015, Bupa and Max India have been working to align their JV agreements with the Insurance Laws (Amendment) Bill 2015 for Indian-owned and controlled businesses. The new agreements will come into force after the requisite regulatory clearances have been secured from the Foreign Investment Promotion Board (FIPB) and the Insurance Regulatory and Development Authority of India (IRDAI).
Launched in 2010, Max Bupa is already the seventh-largest private health insurer in India. With a base of more than two million customers across India, it continues to be amongst the fastest growing stand-alone health insurers. Max Bupa has focused on building a retail customer and product portfolio via multiple sales channels including agency, bancassurance, telesales and online.
Its local parent Max India is one of India's leading multi-business corporates and currently owns 74 per cent of Max Bupa. Its foreign parent Bupa is a UK-headquartered global healthcare group, which holds 26-per cent stake in the company.
Rahul Khosla, managing director, Max India Limited, welcomed the development. ''Bupa's stake increase is a clear affirmation of the huge growth opportunity for health insurance in India. The cash received from the transaction will support growth aspirations of the Max Group as well as for Max Bupa. I am confident that this renewed vote of confidence by Bupa, coupled with the recent strategic reorientation of the company will strengthen its position as an innovative leader in its field while setting new benchmarks in customer experience.''
Speaking at the occasion, David Fletcher, managing director of International Development Markets at Bupa said, ''We see enormous opportunity in India to build on the great foundations of the last few years and use our global expertise to take the business to the next level. We are committed to growing an insurance business that not only provides the best quality healthcare funding but that is at the forefront of helping Indian people to live healthier lives.''
Max India has successfully managed several joint venture partnerships in its diverse businesses. Apart from Bupa, it also has partnerships with Japan's Mitsui Sumitomo for its Life Insurance business and South Africa-based Life Healthcare for its healthcare business.