Prudential to buy 75% stake in Bharti Life for Rs 3,500 crore

UK-based insurer Prudential plc has agreed to acquire a 75% controlling stake in Bharti Life Insurance Company Ltd. for an initial cash consideration of Rs 3,500 crore. The announcement was made on Sunday by Bharti Enterprises, which is selling the stake through Bharti Life Ventures Pvt Ltd and 360 ONE Asset Management. The deal is subject to regulatory approvals.

This acquisition marks a significant consolidation in India's life insurance sector and is the first major transaction since the government permitted 100% foreign direct investment in the industry. Upon completion, Bharti Life will become the fifth insurance company in India with 75% foreign ownership.

Prudential stated the transaction will be funded from its existing resources and is expected to deliver strategic and financial benefits over time. There is also a potential additional consideration of up to Rs 700 crore, dependent on certain conditions being met.

The deal necessitates a major restructuring of Prudential's existing Indian holdings. Regulatory approval is expected to require Prudential to reduce its shareholding in ICICI Prudential Life Insurance Company, where it currently holds a 22% stake, to below 10%....