Bharti AXA and ICICI Lombard merger to create India's third largest general insurer

AXA and Bharti have entered into an agreement to sell its non-life insurance operations in India to ICICI Lombard General Insurance Company. The deal would create the third largest general insurer in India.

ICICI Lombard is one of the largest private sector non-life insurers in India, offering motor, health, fire, personal accident, crop, marine, engineering and liability insurance through multiple distribution channels. Bharti AXA GI has a pan-India presence through 152 branches, and is the 11th largest non-life insurance private sector player in India.

The merger of Bharti AXA General Insurance Company (Bharti AXA GI) into ICICI Lombard would result in an entity with a market share of nearly 8.7 percent.

At present, AXA and Bharti hold 49 percent and 51 percent stake respectively in the joint venture. They will receive a total of 35.8 million shares of ICICI Lombard on closing, which would represent €521 million at current market value.

The deal is subject to customary closing conditions, including the receipt of regulatory approvals. It is expected to close by the fourth quarter of 2021.

French insurer AXA said the transaction is expected to result in a one-time positive net income impact of approximately €0.2 billion in its FY 2021 consolidated financial statements.

The underlying earnings of Bharti AXA GI recorded in AXA Group’s FY19 consolidated financial statements was €1 million. Apart from Bharti AXA GI, AXA’s presence in India also comprises of its 49 percent ownership in Bharti AXA Life, a life insurance joint venture with Bharti.