HDFC Standard Life Insurance Company (known as HDFC Life) and Max Life Insurance Company have agreed to merge their businesses through a composite scheme of arrangement to create India’s largest private life insurer. As a part of the transaction, Max Life will be merged into Max Financial Services and following this, the combined Max Financial Services entity’s insurance business will hive off its life insurance business into HDFC Life.
The combined HDFC Life will be valued at US$9.73 billion and have a market share of 10.8%. HDFC will own a 42.5% stake in the combined entity, while Standard Life will hold 24%, Mitsui Sumimoto 7.8%, Max Group 6.6% and Axis Bank 1.2%.
HDFC Life was already one of India’s leading life insurance companies. Max Life, a non-bank promoted private life insurer, is a joint venture between Max Financial Services and Mitsui Sumitomo Insurance (MSI). Max Financial Services manages a 69% stake Max Life.
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The transaction is expected to come into effect in the next 12-15 months, subject to approval from the Insurance Regulatory and Development Authority of India, Competition Commission of India, Securities and Exchange Board of India, stock exchanges and high courts.
Shardul Amarchand Mangaldas & Co acted as the legal adviser to HDFC Life. Executive chairman Shardul Shroff provided strategic advice. Partners Kalpataru Tripathy, Shailaja Lall, Promode Murugavelu and Yogesh Chande, along with principal associate Ashish Teni, senior associate Shivangi Talwar and associates Ishita Bhardwaj, Shanta Chirravuri, Uday Opal, Akshita Agrawal, and Debrupa Agarwala made up the corporate team. Partners Shweta Shroff Chopra and Aparna Mehra advised on competition law with assistance from principal associate Yaman Verma and associate Prateek Bhattacharya. Partners Amit Singhania and Sandeep Chilana rendered tax advice with help from principal associate Gouri Puri and senior associate Aurica Bhattacharya. Partner Charu Mehta handled intellectual property issues.
A team from AZB & Partners’ Delhi office acted for Max Life and Max Financial Services. Partner Ajay Bahl provided strategic advice while partners Anil Kasturi and Niladri Maulik, senior associates Jaishree Tolani and Abhiroop Datta and associates Kanchan Puri, Ashish Pareek, Ankit Bhasin, Shreya Basu and Paras Chopra advised on corporate aspects of the deal. Partner Samir Gandhi, senior associate Kamya Rajagopal and associate Shashank Sharma advised on competition law, while partners Ravi Prakash and Akhilesh Rai advised on tax and intellectual property, respectively.
Partner Varoon Chandra, senior associate Arvind Ramesh and associate Gaurav Rohra at AZB & Partners in Mumbai advised HDFC.
Cyril Amarchand Mangaldas (CAM), led by partner Shishir Vayttaden with assistance from principal associate Prateek Shroff, acted for Standard Life (Mauritius Holdings) 2006.
Partners Nivedita Rao and Anand Jayachandran at CAM’s Bangalore office advised MSI. The company’s international counsel was Paul Weiss Rifkind Wharton & Garrison, led by partner Kaye Yoshino and counsel Chikara Momoto in Tokyo.
Majmudar & Partners, led by managing partner Akil Hirani, represented Axis Bank.
Partners Rajat Sethi and Sudip Mahapatra along with associate Niruphama Ramakrishnan at S&R Associates advised Citigroup as the financial adviser to HDFC Life.
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