Fertiliser cooperative Indian Farmers Fertilizer Co-operative (IFFCO) on Friday said it will divest 21.64 per cent stake in its insurance…
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Fertiliser cooperative Indian Farmers Fertilizer Co-operative (IFFCO) on Friday said it will divest 21.64 per cent stake in its insurance joint venture IFFCO Tokio General Insurance Company Ltd to its Japanese partner Tokio Marine Asia Pte Ltd for Rs.2,380.40 crore.
Along with IFFCO, Indian Potash Ltd (IPL) will also divest 1.36 per cent stake in insurance company in favour of Tokio Marine for Rs.149.60 crore.
Following the acquisition of 23 per cent stake for Rs 2,530 crore from both the companies, Tokio Marine's stake in the general insurance company would go up to 49 per cent.
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The per share value of IFFCO Tokio General is valued at Rs 408,43.
"This is a good opportunity for IFFCO to unlock the valuation of its investment in IFFCO-TOKIO by sale of its part shareholding. This transaction would help IFFCO in raising the required capital to focus on more agri-businesses and to better serve the interests of the Indian farmers in the fast changing agriculture sector in India," IFFCO Managing Director U.S. Awasthi was quoted as saying in the statement.
Awasthi further said: "Even after the divestment, IFFCO will continue to exercise control in the business affairs of IFFCO-TOKIO in compliance with IRDA's Guidelines on 'Indian Owned and Controlled' Insurance Companies."
The Chief Executive of Tokio Marine Asia Arthur Lee said: "The additional share purchase is in line with Tokio Marine Group's international business strategy to achieve sustainable growth and profit expansion as well as enhance diversified business portfolio through capturing growth opportunities in emerging countries."
As on March 31, 2017, IFFCO and its associate IPL were holding 72.64 per cent and 1.36 per cent paid up share capital in IFFCO TOKIO, whereas Tokio Marine was holding 26 per cent paid up share capital in the company.
Post the share sale, IFFCO's holding in IFFCO Tokio General will be 51 per cent and Tokio Marine's will be 49 per cent.
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