SBI Life to throw away stake to foreigners in 3-4 months
A decision with regard to stake dilution in SBI Life Insurance in favour of foreign partner is to be finalised in the next three-four months, a top official of insurance firm said. "The discussion with the foreign partner BNP Paribas Cardif of France is going on. It is at advance stages.
Hopefully, a decision should be known in the next 3-4 months," SBI Life Insurance Managing Director and CEO Arijit Basu said. "Various aspects are being looked at. It is a process which has to be completed as BNP Paribas Cardif first right of refusal," he said. It is believed that the foreign partner is most likely to increase its stake in the leading life insurance firm promoted by the country's largest lender State Bank of India (SBI).
Last month, SBI decided to divest up to 10 <g data-gr-id="26">per cent</g> stake in its life insurance venture. SBI Life Insurance is a 74:26 per cent joint venture between SBI and BNP Paribas Cardif of France. At present, SBI owns 74 per cent of the total capital and BNP Paribas Cardif has the remaining 26 <g data-gr-id="27">per cent</g> in the joint venture. Stake dilution by SBI will help the country's largest bank in <g data-gr-id="28">monetising</g> its investment and provide growth capital for banking business. SBI Life Insurance has an authorised capital of Rs 2,000 <g data-gr-id="29">cr</g> and a paid-up capital of Rs 1,000 <g data-gr-id="30">cr</g>, according to its website. In March, Parliament passed the Insurance Laws (Amendment) Bill, 2015 which seeks to increase foreign investment in private sector companies to 49% from the existing 26%.