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Last Updated : Feb 06, 2019 03:07 PM IST | Source: Moneycontrol.com

Will look for local majority shareholder in DHFL Pramerica Life Insurance, says foreign partner

DHFL may either sell a part of its stake or exit the life insurance company

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Prudential Financial, the foreign joint venture partner in DHFL Pramerica Life Insurance (DPLI) said it will find a new majority Indian shareholder for the company and will work with JV partner Dewan Housing Finance for this process.

In a conference call with analysts, Kapil Wadhawan, Chairman and Managing Director of DHFL said they are in talks to sell the stake in life insurance and have appointed investment bankers for this process.

James Weakley, Senior Vice President, International Businesses, Prudential Financial Inc. said the company remains focused on maintaining the strength of the DPLI joint venture, on their long-term strategy for the Indian market.

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“While DHFL may reduce or exit its equity stake in DPLI, Prudential Financial's intention is to continue to play an active role in supporting the life insurance industry of India,” added Weakley.

DHFL holds 51 percent in the JV while 49 percent is held by Prudential Financial.

DHFL has been dealing with a liquidity crisis since September 2018, like other non-banking financial companies. This is after a series of defaults by infrastructure lender IL&FS on its debt payments since June 2018.

DPLI has been a profitmaking entity and posted a net profit of Rs 105.8 crore in FY18. It had collected new premiums of Rs 1,449.84 crore in FY18, growing 65.4 percent year-on-year increase.

On February 2, DHFL had announced its decision to divest its stake in Aadhar Housing Finance to Blackstone.

Private equity major Blackstone agreed to buy nearly 80 percent of affordable homes-focused Aadhar Housing Finance from the financially stretched Wadhawan group for an undisclosed sum.

The deal happened just days after the group was alleged to have siphoned off over Rs 31,000 crore of public money by news portal Cobrapost, which claimed loans were taken from DHFL and the money taken out of the country by the Wadhawans. The group has denied all the allegations.

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First Published on Feb 6, 2019 03:07 pm
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