In October 2023, Bharti Group declared its intention to acquire the 49% stake held by its joint venture partner, AXA Group, in the life insurance business. Currently, Bharti Group is actively engaging in advanced negotiations with SBI Life and other insurers to sell its wholly-owned life insurance venture, Bharti AXA Life Insurance, according to sources familiar with the matter.
Bharti Group Explores Exit from Life Insurance Sector
Following the October 2023 announcement of plans to acquire AXA Group’s 49% stake in the life insurance business, Bharti Group, having obtained the business from AXA, is actively seeking to divest from the insurance sector and shift its focus to telecom, as revealed by one of the sources. Subsequently, after merging the general insurance business with ICICI Lombard, Bharti has been actively pursuing the complete sale of the life insurance business.
The possibility of the deal going through remains uncertain, and individuals mentioned earlier declined to provide clarity. Bharti spokespersons refrained from commenting, and SBI Life asserted that it would not comment on market speculation.
Bharti’s Life Insurance Deal Value and Ownership Await Regulatory Clearance
The potential deal value for Bharti’s life insurance business or the amount Bharti paid for AXA’s 49% stake is unclear. Post the acquisition of AXA’s stake, Bharti Life Ventures Pvt Ltd (BLVPL), the holding firm of Bharti Group’s insurance business, is expected to attain full ownership of the life insurance venture, pending regulatory clearances. In 2006, Bharti and the French insurer formed two joint ventures, with the Indian partner holding a 74% stake in both Bharti AXA Life Insurance and Bharti AXA General Insurance.
Bharti AXA Life Insurance
In 2020, ICICI Lombard absorbed the general insurance venture as AXA exited the company. Previous attempts by Hinduja Group and Abu Dhabi Investment Authority (ADIA) to acquire AXA’s stake in the life insurance venture did not materialize, prompting Bharti to proceed with the buyout.
Bharti AXA, holding a 2% market share in the life insurance sector by premium, reported an equity share capital of Rs 3,706 crore as of March 31, 2023. In the last fiscal year, the company underwrote premium income amounting to Rs 2,920 crore. As of March 2023, Bharti AXA Life Insurance boasted an investment book of Rs 12,009 crore, with its solvency standing at 1.63 times, surpassing the regulatory requirement of 1.5 times.
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