State-owned Bank of India (BOI) has sold 18 percent stake in the insurance joint venture Star Union Dai-ichi Life Insurance Company Ltd (SUD) to its Japanese partner.
"Upon change in law, Bank of India has sold its 18 percent stake in Star Union Dai-ichi Life Insurance Company Ltd (SUD) to Dai-ichi Life Insurance Company Limited (DILIC)," the lender said in a regulatory filing.
"The shareholding of DILIC will be 44 percent up from 26 percent upon completion of the transaction after receiving necessary statutory/regulatory approvals," it added.
BOI said the transaction was completed today, i.e.
September 26, 2016.
With this, the shareholding of BOI has come down to 30 percent from 48 percent in SUD. While, Union Bank of India will continue to hold 26 percent.
SUD was incorporated in 2007 as a joint venture among Bank of India, Union Bank of India and DILIC to undertake life insurance business in India.
As per the terms of the joint venture agreement, DILIC had an option to purchase 18 percent additional stake in SUD upon change in law related to higher stake by foreign partners in their Indian joint ventures, allowing them to raise their stake from the allowed 26 percent to up to 49 percent.
"DILIC has since exercised the call option to acquire the said stake from Bank of India and increased shareholding of DILIC will be 44 percent up from 26 percent upon completion of the transaction after receiving necessary regulatory approvals," it said.
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