Amarchand & Mangaldas & Suresh A. Shroff Co has advised MS&AD Insurance Group, Japan’s largest property-casualty insurer by revenue, on its $530 million purchase of New York Life Insurance’s 26 percent stake in the latter’s India JV, the second-largest FDI in India’s insurance sector.
The purchase of the stake at 27.31 billion rupees values the JV, Max New York Life Insurance, at more than 105 billion rupees. In the Indian insurance space, the transaction is only dwarfed by the 30.62 billion rupees Japan’s Nippon Life paid last year to pick up a 26 percent stake in Reliance Life Insurance. The 26 percent stake is the maximum allowed for foreign ownership in Indian life insurers, although a possible change to lift the limit to 49 percent has long been pending.
The JV between MS&AD and its India partner Max India will be renamed Max Life Insurance.
Reuters reports that MS&AD is among the industry's most aggressive in expanding in Asia through acquisitions, buying both life and non-life assets to secure growth beyond its weak home market. A year ago, it bought a 50 percent stake in Indonesia's PT Asuransi Jiwa Sinarmas for about 67 billion yen ($827.21 million). It was already in a general insurance joint venture in India.
This deal is the latest in a spate of outbound deals from Japan, Despite the large size of the Japanese economy there is little growth in its domestic market. That, combined with low interest rates and a strong yen, has pushed Japanese companies to aggressively buy up overseas assets, Reuters adds.
In the transaction, Max India was advised by AZB & Partners and Paul Weiss, while New York Life Insurance was advised by Platinum Partners and Freshfields Bruckhaus Deringer. The Amarchand team was led by Bangalore-based partner Nivedita Rao. ALB
Ranajit Dam is Southeast Asia Editor at ALB. Follow him on Twitter: @RanajitDam_ALB.