The insurance regulator on Friday prescribed a minimum promoter shareholding of 50% in listed insurance companies.In cases where the present holding of the promoters is less than 50%, regulator said that such holding should be the minimum holding.
Last month, ICICI Prudential filed an offer document with the capital markets regulator to sell 12.5% in what could be the first insurance listing on Indian stock exchanges.
Post-issue, ICICI Bank will own 55% of the company , and Prudential 25.88%. Azim Premji’s fund would own 4.01% and Temasek’s unit 2%.According to the norms issued by IRDAI, ICICI Bank can sell an additional 5% as promoter of the listed life insurance company. The Insurance Amendment Act had allowed foreign direct shareholding of 49% from 26%.
One of the key amendments was to ensure that ownership and control remains with Indian promoter.
These guidelines will be applicable to insurers listed in a stock exchange or for allotments pursuant to a public issue. For creeping acquisition in excess of 5% by an acquirer who has already obtained IRDAI approval for holding more than 5% but less than 10%, no further approval from sector regulator would be required. Also, one insurer would be permitted to invest in the shares of another listed insurer subject to investment regulations.
Source: The Economic Times
Date: 06th August, 2016