IDBI Bank sells 23% stake in its life insurance arm to Ageas for Rs 507 crore

Private lender IDBI Bank on Thursday, December 31 2020, concluded the sale of 23 per cent stake in IDBI Federal Life Insurance Company Ltd (IFLI) to Ageas Insurance International NV for a consideration of Rs 507 crore. With this, Ageas will hold 49 per cent stake in the insurance venture, which is now being rebranded as Ageas Federal Life Insurance Company.

In a regulatory filing, IDBI Bank said, "IDBI Bank has completed sale transaction of its 23% stake to Ageas Insurance International JV on December 31, 2020, pursuant to the receipt of the requisite regulatory approvals. Pursuant to the sale of 23 per cent holding representing 18,40,00,000 shares to Ageas for a consideration of Rs 507.10 crore, IDBI Bank's shareholding in IFLI now stands at 25 per cent from the earlier 48 per cent. Following this transaction, the joint venture has been rebranded as Ageas Federal Life Insurance Company Limited."

On August 6, 2020, IDBI Bank inked a Share Purchase Agreement (SPA) to sell up to 27 per cent of its stake in its joint venture arm IDBI Federal Life Insurance Company Limited (IFLI) to other JV partners viz. 23 per cent to Ageas Insurance International NV (Ageas) and four per cent to The Federal Bank Limited (Federal Bank).

At present, IDBI Bank has completed the sale of its 23 per cent stake to Ageas pursuant to the receipt of the requisite regulatory approvals, IDBI said in a statement.

Following the stake sale, IDBI bank would hold a 25 per cent stake in the company. The stake will come down to 21 per cent after it concludes the sale of an additional four per cent stake to Federal Bank. The sale of stake became necessary after Life Insurance Corporation of India became the promoter of the bank.

IDBI Bank would continue its business association with Ageas Federal Life Insurance as one of its channels to sell insurance policies and also have a seat on the board.