Zurich Insurance to buy 70% stakes in Kotak General for ₹5,560 crore 

Kotak Mahindra Bank was notified by Zurich Insurance business in a regulatory statement to the stock markets on Friday, February 23, that the business would be purchasing a seventy percent share in Kotak General Insurance Company Limited for ₹5,560 crore in a single payment. Prior to this, Zurich Insurance had declared that it would buy 51% of the company initially and the remaining 19% over the course of three years. The remaining conditions of the deal, according to Kotak Mahindra Bank, are unaltered.

‘’We refer to our disclosure dated November 2, 2023 in respect of the proposed acquisition of the shares of Kotak Mahindra General Insurance Company Limited by Zurich Insurance Company Ltd, by way of initial acquisition of 51 per cent of the share capital through a combination of capital infusion and share purchase, followed by a subsequent acquisition of additional stake of 19 per cent within a period of three years from the initial acquisition to take Zurich’s shareholding to 70 per cent of the share capital of Kotak General,” stated Kotak Mahindra Bank in an exchange filing.

‘’The parties to the aforesaid transaction, viz., the Bank, Zurich and Kotak General have mutually agreed that Zurich will acquire 70 per cent stake in Kotak General by way of a combination of primary and secondary acquisitions in a single tranche, for a total consideration of approximately ₹5,560 crore, instead of the proposal announced in our earlier disclosure,” continued Kotak Mahindra Bank.

‘’The other terms of the transaction remain unchanged. The proposed 70 per cent acquisition would be subject to fulfilment of customary conditions precedent, including the receipt of regulatory approvals from the Reserve Bank of India and the Insurance Regulatory and Development Authority of India,” it mentioned.

This agreement represents the biggest investment made in an Indian non-life insurer by a foreign insurer. The conditions of the purchase will remain same, and Kotak General’s valuation, as stated in the November 2023 filing, was ₹7,943 crore. Kotak Mahindra’s stock ended the day on the BSE 0.10 percent lower at ₹1,724.80 a share.