Edelweiss gets FIPB nod to raise Tokio's stake to 49 per cent

MUMBAI: Edelweiss Tokio Life has obtained final nod from Foreign Investment Promotion Board for raising its foreign joint venture partner – Tokio’s - stake to 49 per cent in the company from 26 per cent earlier, the company said in a stock exchange notification on Tuesday.

"The funds will help expand the insurance venture, which is a capital-intensive business," said Rashesh Shah, chairman and CEO of the Edelweiss Group told ET.

"We have already Rs 500 crore cash. Funds are important to penetrate our insurance presence. With Tokio’s stake increase, there will be another capital infusion of Rs 540 crore," he said.

Edelweiss Tokio Life Insurance is a joint venture between Edelweiss Financial Services and Tokio Marine Holdings Inc. The Indian partner will now hold 51 per cent.

The approval came after the government had passed the insurance bill, raising the ceiling for foreign investment in the sector to 49 per cent from 26 per cent, six months ago.

Till now, only AXA has received approval from FIPB to raise its stake in the Indian life and general insurance companies.