Kotak Mahindra General Insurance: Zurich Insurance completes 70% stake purchase, Kotak Mahindra Bank to retains 30% stake

Kotak Mahindra Bank informed the stock exchanges that the private lender holds the remaining 30% of the share capital of Kotak General Insurance Company after the deal.

Kotak Mahindra Bank shares rose nearly 2% to hit a high of ₹1,763 per share on NSE on Wednesday. More than 45 lakh shares of the bank traded on the exchange. The stock closed 1.49% higher at ₹1,745 apiece on the NSE.

The private lender, in November 2023, had announced a deal under which Zurich Insurance Company Ltd had agreed to acquire 51% of the share capital in the general insurance arm through a combination of capital infusion and share purchase initially. Zurich Insurance had proposed to acquire another 19% within a period of three years from the initial acquisition to take its shareholding to 70% of the share capital of Kotak General.

In February, Kotak Bank, Zurich, and Kotak General mutually agreed that Zurich would acquire a 70% stake in Kotak General through a combination of primary and secondary acquisitions in a single tranche for a total consideration of ₹5,560 crore.

The bank on June 5 announced that the Reserve Bank of India (RBI) approved the transaction.

“Pursuant to completion of relevant conditions precedent, including receipt of relevant regulatory approvals, Zurich has completed the acquisition of 70% of the share capital of Kotak General,” Kotak Bank said in a filing on June 18.

Kotak Mahindra Bank reported a 17% growth in profit after tax to ₹5,337 crore for the March quarter against ₹4,566 crore in the year-ago quarter. For the full 2023-24 fiscal, PAT rose by 22% to ₹18,213 crore compared to the year-ago period.

Kotak Mahindra General Insurance, however, reported a loss of ₹58 crore in the March quarter against a loss of ₹55 crore in the same quarter of FY23.