Promoters of L&T General Insurance and HDFC Ergo are in merger talks. L&T General Insurance is the only private company after Reliance General to be wholly owned by Indian shareholders and HDFC Ergo is the third largest private general insurance company .
According to sources, L&T has been looking at monetizing its investment in the general insurance business for some time. The non-life company had in 2013 proposed to merge with Future Generali Insurance, which would have resulted in a three-way joint venture. The deal, however, did not go through. Subsequently , the company has been looking at bringing in a foreign partner While it is not clear how L&T will extract value from the new three-way deal, one possibility is that German insurer Ergo, which is part of the Munich Re group, would buy some of the fresh equity created to maintain its stake at 49%.
Source : The Times of India
Date : 06-05-2016