Exide Life will be merged into HDFC Life after the acquisition.
HDFC Life, on September 3, said it would acquire Exide Life Insurance for Rs 6,687 crore. Exide Life will be subsequently merged into HDFC Life.
"HDFC Life will acquire 100 percent stake in Exide Life Insurance from Exide Industries via issuance of 8,70,22,222 shares at an issue price of Rs 685 per share and a cash payout of Rs 726 crore aggregating to Rs 6,687 crore," the company said in a statement.
The proposed deal will help accelerate the growth of HDFC Life's agency business, and tap into Exide Life's strong presence in South Indian cities.
The transaction is subject to the relevant regulatory approvals.
HDFC Life share price falls 4% on acquisition of Exide Life
We believe that this amalgamation can result in value creation for customers, employees, shareholders and distribution partners. It gives us an opportunity to realise synergies arising out of complementary business models, and further bolster our proprietary distribution network," said Vibha Padalkar, MD and CEO of HDFC Life.
HDFC Life while Trilegal served as the legal advisor to Exide Life and Exide Industries. Deloitte Touche Tohmatsu India LLP and Rashmi Shah FCA (Registered Valuer) were hired as valuers for the transaction by HDFC Life, and Desai Haribhakti & Co, Chartered Accountants and S Sundararaman (Registered Valuer) were appointed as valuers by Exide Industries.
"This transaction is testimony to the reputation that Exide Life insurance has built of being a well-managed company. We look forward to working closely with the HDFC life team on the proposed transaction. Being part of one of India’s most respected life insurance companies will certainly benefit our customers, employees, agents and partners," said Kshitij Jain, MD and CEO of Exide Life Insurance.
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