|Tsutsui & Ambani: Pact push
Mumbai, Oct. 9: Reliance Capital has completed the sale of a 26 per cent stake in its life insurance venture Reliance Life to Japans Nippon Life for over Rs 3,000 crore.
The company has received the entire transaction proceeds of Rs 3,062 crore ($680 million) from the Japanese financial services major, Reliance Capital said in a statement.
The deal, which was announced in March, pegs the total valuation of Reliance Life Insurance at approximately Rs 11,500 crore ($2.6 billion).
Following the deal, Reliance Capital will hold a 74 per cent stake in Reliance Life.
The deal has received all regulatory approvals required for its completion.
Reliance Capital — the financial services arm of Anil Ambani-led Reliance group — has interests in telecom, power, entertainment and infrastructure businesses.
On the development, Reliance Capital CEO Sam Ghosh said Nippon was coming on board as a valued strategic partner in Reliance Life Insurance.
Nippons vast experience of over 122 years will help strengthen Reliance Life Insurances position as a leading and world-class insurance company in India, Ghosh said.
Nippon Life Insurance president Yoshinobu Tsutsui said the Japanese firm was keen to work with Reliance and establish a long-term partnership that was mutually beneficial.
Nippon Life, also known as Nissay, is the seventh-largest life insurer in the world and the largest private life insurer in Asia and Japan.
It posted revenues of Rs 3,49,834 crore ($80 billion) and a profit of Rs 12,199 crore ($3 billion) for the fiscal year ended March 31, 2011.
Reliance Life started operations in 2005 after the acquisition of a life insurance company by the Reliance group.
At present, it is one of the largest insurers in terms of the number of individual policies sold by any of the 23 private life insurers in India.
The company has sold over 7 million policies and managed assets of about Rs 18,000 crore ($4 billion) as of March 31.