RBI approves Zurich Insurance Company to acquire 70% in Kotak Mahindra General Insurance for ₹5,560 crore

“…the Reserve Bank of India has, vide its letter dated June 4, 2024…conveyed its approval for the transaction,” Kotak Mahindra wrote in the regulatory filing.

The transaction would soon materialize “upon fulfillment of other conditions precedent”, as all other required approvals have been received, Kotak mentioned. Kotak General is a 100% subsidiary of Kotak Mahindra Bank.

In November 2023, Zurich Insurance Company announced its plans to acquire a 51% stake in Kotak Mahindra General through share purchase and capital infusion. Subsequently, Zurich would acquire an additional 19% in the next three years from the initial acquisition of ₹5,560 crore.

Earlier this month, the Competition Commission of India had approved the Zurich-based company to pick up a 70% stake in Kotak General.

Zurich Insurance company is a wholly-owned subsidiary of Zurich Insurance Group Ltd. (Zurich Insurance Group), with businesses in more than 200 countries across the globe.

According to current regulatory guidelines, a foreign company can own up to 74% in an insurance business in India.

Kotak Mahindra Bank shares saw a jump of over 4% on Wednesday, after the news of the RBI approval of the Zurich Insurance Company’s proposed buying of 70% in Kotak General. Kotak Mahindra Bank surged by 4.6% to ₹1714.85 on BSE. Its market cap rose to ₹3.40 lakh crore.