New DelhI
Acting on their merger plans, three Indian state-owned non-life insurance companies,which the government plans to merge into a single company,on Thursday sought to appoint consultants to advice them on the deal. The consultants have to submit their bid by July 16.
In February, the finance minister in his annual budget announced the plan to merge National Insurance Co Ltd, Oriental Insurance Co Ltd and United India Insurance Co Ltd.
As on March 2017, three public sector general insurance companies together have more than 200 Insurance Products with a total premium of Rs. 41,461 crores and a market share of around 35 per cent.. The combined Net Worth of three Companies is Rs. 9,243 crores with total employees’ strength of around 44,000 spread over 6000 Offices.
The consultant will need to handhold the management of all the three companies, throughout merger process till the new organization is formed and set in place and to build a strong entity creating enterprise value and shareholders' worth for better listing.
The consultant has to suggest an action plan with broad time lines to bring all the three into a single merged entity, with a new name, logo and a new Head Office.
It will also work out a scheme for rationalization of offices, merger and unification of offices, creation of new organizational structure. The new entity should assimilate all the individual geographical dominance.
The consultant has to design and finalise series of advertisement and public communication campaigns & media management leading to the creation of single entity with least disruption in business, image or brand equities.
The consultant’s briefs in the different areas are:
Human Resources:
The consultant has to rationalize all the employees into the merged entity without any loss of any entitlements as seniority and cadre position with reference to peer groups. To measure efficacy of Human Resources post merger.
Information Technology
To study and develop action plans to integrate and rationalize the separate IT platforms, data base licenses, Data Centers & Disaster Recovery Centers, Network, migrate existing contract into the new entity, rationalization of vendors, combined data management, combined security tools and data protection arrangements.
Operational Issues:
To study various products offered by the current companies and rationalisation of products. to examine various business processes of three Companies and optimal unification of such processes. To design and develop a smooth transition without causing any adverse impact in customer services, customer acquisition & retention & market share. To assimilate all the brand equities into new ones – this will capture and retain all customer &intermediary relations & loyalties. To suggest ways and means to amalgamate any reinsurance treaties, arrangements, balances, pending claims recoveries, reconciled balances into the new entity.
Investment:
To advise on ways and means of consolidating the investment corpus of all companies, handling the subordinate debt, amalgamating & augmenting investment income and related matters. To amalgamate Real Estate properties of each of the company into single name.