The Competition Commission of India (CCI) has approved acquisition of 70% stake by Zurich Insurance Company Ltd. (Acquirer) in Kotak Mahindra General Insurance Company Limited (Target).

The Proposed Combination involves an acquisition of a majority stake in Target by the Acquirer from Kotak Mahindra Bank Limited. Pursuant to the Proposed Combination, the Acquirer will acquire a 51% stake in Target (through a combination of fresh growth capital and share purchase). In addition to the above, the Acquirer will also acquire an additional stake of up to 19% in the Target, over a period of time.

The Acquirer is a wholly owned subsidiary of Zurich Insurance Group Ltd. (Zurich Insurance Group) The Acquirer is a leading multi-line insurer serving people and businesses in more than 200 countries and territories. The Acquirer as part of the Zurich group has about 60,000 employees and is headquartered in Zurich, Switzerland.

The Acquirer is the principal operating insurance company of the Zurich Insurance Group. Besides being an insurance company, the Acquirer also acts as the holding company of many subsidiaries and other affiliates of the Zurich Insurance Group except for the Zurich Insurance Group’s property loans and banking activities.

The Target is engaged in the business of providing a wide range of general insurance policies such as motor vehicle insurance, home and property insurance, commercial and health insurance. It offers a range of products such as liability insurance, extended warranty insurance, health insurance plans such as hospital cash, health indemnity policy, benefit policy and group insurance plans.

Detailed order of the CCI will follow.

Merger control approval: foreign insurer cleared to acquire majority stake in Indian general insurer with staged share purchases permitted. The Competition Commission of India has approved a proposed combination whereby a foreign insurer will acquire a controlling stake in an Indian general insurer through a combination of fresh growth capital and share purchase, with provision to acquire an additional minority parcel of shares over time to attain an aggregate majority holding; the acquirer is the principal operating insurer of a global group and the target underwrites motor, property, commercial and health insurance products, and a detailed order will follow.