Nippon Life Insurance looks for M&A in Indian life insurance and MF biz

  Mumbai: After raising its stake to 75 pe cent in the Reliance Mutual Fund, Nippon Life Insurance, Japan’s largest Life Insurance company and a global financial services conglomerate today announced the rebranding of the company as Nippon India Mutual Fund and ...

Hiroshi Shimizu, president, Nippon Life Insurance Company

 

Mumbai:
After raising its stake to 75 pe cent in the Reliance Mutual Fund, Nippon Life Insurance, Japan’s largest Life Insurance company and a global financial services conglomerate today announced the rebranding of the company as Nippon India Mutual Fund and integration of the company into their global unified asset management fold.

 

Hiroshi Shimizu, president, Nippon Life Insurance Company said “We have invested Rs 7,800 crore total since the beginning to raise our stake to 74 per cent in the in the erstwhile Reliance Mutual Fund.We had entered India at the right time in both asset management and life insurance businesses with long term vision and the completion of this transaction echoes our commitment for India. Indian asset management space is quite attractive and has a long-term growth potential which is in line with our goals. We will be looking for merger and acquisitions(M&A) in both the sectors.”


Nippon India Mutual Fund becomes the largest foreign-owned AMC in India, wherein Japan’s largest life insurance company Nippon Life Insurance upped its stake to 75 per cent stake allowing Anil Ambani-promoted Reliance Capital an exit from the mutual funds business.Nippon Life insurance also holds 49 per cent, the maximum per centage of foreign direct investment (FDI) allowed, in Reliance Life Insurance Company,

 

According to the sources,Reliance Life Insurance company has demanded that the FDI in the domestic life insurance industry be raised to 100 per cent, indicating that the promoter Anil Ambani may also sell its entire stakes in the life insurance company to the Nippon Life Insurance.

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He further said, “We will provide full support to expand International and Alternate business by leveraging our global network. We remain committed for the success of India business both in domestic and international markets. We are also very keen to incorporate more of global expertise into the mix and further improve upon processes in a steady manner wherever it helps – especially areas such as risk management and governance practices.”
 

In Japan, about 1 out of 12 is a policyholder of Nippon Life Insurance and they have similar vision in India for their mutual fund business.
 

Reliance Nippon Life’s AMC market share has fallen to eight percent in August from 12 percent in March. Sikka said the company will focus on regaining its market share and increase profitability.

 

On September 27, Nippon Life Insurance acquired 75 percent stake in RNAM from Reliance Capital for around Rs 6,000 crore.The Japanese firm had initially acquired 26 percent stake in 2012.
 

 


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