Housing Development Finance Corporation has increased its stake to over 50 percent in HDFC Life Insurance Company after getting the green light from the Competition Commission of India (CCI) and the Insurance Regulatory and Development Authority of India (RDAI).
"HDFC has acquired 3,62,22,213 equity shares of HDFC Life, representing 1.69 percent of the total issued and paid-up capital, from the secondary market between June 26 and June 28," the life insurer said in a filing to exchanges.
HDFC picked up 1.65 crore equity shares in HDFC Life through open market transactions at an average price of Rs 674.87 per share on June 28 and another 1.48 crore shares at an average price of Rs 667.1 per share on June 26, as per the bulk deals data available on exchanges.
HDFC now holds 50.33 percent of the total paid-up share capital of HDFC Life and thus HDFC Life has now become a subsidiary of HDFC, said the filing. As of March 2023, HDFC had held 48.65 percent stake in HDFC Life.
After the requests from HDFC Bank, RBI had in April permitted the transfer of shareholding of the Corporation in HDFC Life and HDFC ERGO General Insurance Company, to HDFC Bank. And advised that HDFC or HDFC Bank should increase the shareholding in HDFC Life and HDFC ERGO to more than 50 percent prior to the effective date of the scheme, the RBI said.
Later, fair trade watchdog CCI on June 20 and insurance regulator IRDAI on June 23 had granted their approval to HDFC to raise its stake in HDFC Life beyond 50 percent.
The mortgage lender clarified on June 27 that July 1 is simply the 'tentative' date for completion of its merger with HDFC Bank. "The record date of July 13 is also tentative and subject to completion of certain formalities," HDFC said in an exchange filing. The clarification from HDFC came hours after its chairman Deepak Parekh announced these two dates.
On April 4 last year, the board members of HDFC approved the scheme of amalgamation. As per the scheme, subsidiaries HDFC Investments and HDFC Holdings will be merged with the promoter HDFC, and then HDFC will be merged with HDFC Bank.
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