Manulife may acquire 26% stake in ING Life

MUMBAI: Canada-based Manulife Financial Services is in advanced talks with battery maker Exide Industries to buy 26% stake in ING Life Insurance, people close to the development said. Led by the Raheja famil—Exide— has been searching for a partner since January when Dutch Financial group ING exited the insurance company.

“Manulife is in advance talks Exide to buy 26% in the company,” said an executive requesting anonymity. Mukul Gupta CEO of Manulife declined comment. The deal value could not be ascertained but ING Life was valued at about Rs 1,100 crore when ING exited. The Canada-based insurer has been scouting for a partner to foray into India for over three years.

Manulife can buy 26%, the maximum permissible under the current laws. Manulife’s talks come in the backdrop of slowing growth in the insurance sector and the exit of some well-known names from the country in the past few years.

If the talks are successful, it will be the first major investment by an insurance company in India since April, when Sumitomo tied up with Delhi-based Max India. New York Life and ING have exited Indian operations while British banking giant HSBC is in talks to follow suit.

Life insurance industry growth has been slowing due to the general economic slowdown and the after effects of a clampdown on unfair practices by the insurance regulator. Global insurers are waiting for an increase in the foreign direct investment limit to 49% before investing more money.

The Insurance Amendment Bill is yet to be tabled in the monsoon session of the parliament though the government gave some indications that it may be passed by the end of the session. An Exide spokesperson declined comment on what it termed as market speculation.

Exide had purchased 50% stake from three investors including ING, retired investment banker Hemendra Kothari and the Enam group taking the entire control over the company.