AXA and Bharti to combine their non-life operations in India into ICICI Lombard, in exchange of shares

AXA and Bharti announced today that they have entered into an agreement to combine their non-life insurance operations in India, Bharti AXA General Insurance Company Limited (“Bharti AXA GI”), into ICICI Lombard General Insurance Company Limited (“ICICI Lombard”). The transaction will propel the combined entity to #3 amongst non-life insurers in India, with a market share of ca 8.7%*. AXA and Bharti’s ownership of Bharti AXA GI is 49% and 51% respectively.

Under the terms of the agreement, AXA and Bharti will receive a total of 35.8 million shares of ICICI Lombard on closing, which would represent Euro 521 million* at current market value, and an implied HY 2020 P/BV* multiple of more than 5 times. The transaction is expected to result in a one-time positive Net Income impact of approximately Euro 0.2 billion* in AXA Group’s FY 2021 consolidated financial statements.

The transaction is subject to customary closing conditions, including the receipt of regulatory approvals, and is expected to close by 4Q 2021.

About Bharti AXA GI

Bharti AXA GI is the 11th largest non-life insurance private sector player* in India. The company has ca. 2,300 employees and has a pan-India presence through 152 branches. It distributes a comprehensive suite of retail and commercial non-life products through a multi-channel approach including motor dealers, agencies, the Airtel network (Bharti’s flagship company and one of the world’s largest telecom providers), bancassurance and digital. The Underlying Earnings of Bharti AXA GI recorded in AXA Group’s FY19 consolidated financial statements was Euro 1 million.

Apart from Bharti AXA GI, AXA’s presence in India also comprises of its 49% ownership in Bharti AXA Life, a life insurance joint venture with Bharti.

About ICICI Lombard

ICICI Lombard is one of the largest private sector non-life insurer* in India based on gross direct premium income in fiscal 2020. The company offers its customers a comprehensive and well-diversified range of products, including motor, health, fire, personal accident, crop, marine, engineering and liability insurance, through multiple distribution channels.

(*) - please download document for full reference