HDFC may sell 9.57% stake in HDFC Life

HDFC plans to sell 9.57% stake in its subsidiary HDFC Life Insurance through an initial public offering (IPO) that will consist of 19,12,46,059 equity shares with face value of Rs 10 each of HDFC Life.
 
As of June 30, 2017, HDFC held 61.52% stake in HDFC Life. The bank will disclose further details in the short term regarding the IPO such as size of the offer, price, etc.
 
The merger proposal between HDFC Life Insurance Limited and Max Life Insurance Company was turned down by the Insurance Regulatory and Development Authority (IRDAI) and they were looking for an alternative approach to the merger.
 
IRDAI did not allow the merger of a life insurance company with a non-life insurer. The regulator had expressed concerns around Section 35 of the Insurance Act 1938, which does not allow merger between one insurance business and another (non-insurance) business.
 
HDFC Life is a joint venture between HDFC and Standard Life. Currently, among life insurance companies, only ICICI Prudential Life Insurance is listed on the stock exchanges. SBI Life Insurance and ICICI Lombard General Insurance have filed for their IPOs.