Max Financial files Axis Bank-Max Life deal papers with IRDAI

It’s one step closer for the Axis Bank-Max Life deal as sources tell CNBC-TV18 that Max Financial Services has moved the insurance regulator to seek approval. Sources tell CNBC-TV18 that Max Financial Services has filed papers with the IRDAI seeking its approval for the transaction under which Axis Bank plans to acquire about a 7% stake in Max Life Insurance.

As per sources, IRDAI will consult the other two regulators, the Reserve Bank of India (RBI) and the Securities and Exchange Board of India (SEBI), before granting a final go-ahead or raising any observations.

The price proposed for the transaction by the company is Rs 113 per share which was even disclosed to exchanges in the month of August. Max Financial has informed the insurance regulator that the proposed pricing for the transaction is as per fair market value.

Axis Bank and Max Financial Services had informed the exchanges that the bank would be infusing Rs 1,612 crore for a slightly over 6% stake which it would acquire in Max Life Insurance.

It is important to note that this would be 4X the price that Axis Bank paid to acquire the first 13% stake in the company under which it acquired shares of Max Life Insurance at an average price of Rs 32 per share.