Axis Bank to infuse Rs 1,612 crore in Max Life via preferential allotment

10 Aug 2023 , 10:03 AM

On August 9, the Axis Bank board approved a Rs 1,612-crore investment in Max Life Insurance Company Limited, a major subsidiary of Max Financial Services Limited. 

The bank stated that the request for the injection via preferential allotment was authorized by the Acquisitions, Divestments and Merger Committee.

The bank will now enter into a Share Subscription Agreement with Max Life for the proposed acquisition of 14,25,79,161 fully paid-up equity shares of face value of Rs 10 each at a fair market value of Rs 113.06 per share (determined in accordance with existing regulations and including a share premium of Rs 103.06 per equity share), according to Axis Bank.

According to the bank, the planned acquisition would boost its position in the life insurance business. Axis Bank said that the completion of this purchase will increase the bank’s total investment in Max Life (together with its subsidiaries such as Axis Securities Ltd. and Axis Capital Ltd.) from 12.99% to 19.02%.

The planned acquisition would be done at Fair Market Value utilizing the Discounted Cash Flow technique. The bank said that the transaction is expected to take four to six months to complete.

At around 10.00 AM, Axis Bank was trading 0.31% lower at Rs 947.05, against the previous close of Rs 950 on NSE.

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