Nippon Life Insurance (NLI) of Japan has agreed to increase its stake in Reliance Capital Asset Management (RCAM), a part of Reliance Capital, to 49 per cent from the existing 26 per cent in two or more tranches.
InvestmentThe Japanese company will be investing an aggregate value of Rs.657 crore ($108 million) to acquire an additional stake of 9 per cent in RCAM in the first tranche, to reach a 35 per cent stake.
“The transaction pegs Reliance Capital Asset Management’s valuation at Rs.7,300 crore ($1.2 billion), the highest valuation till date for any asset management company in the country,” a joint press release issued here by the two companies stated. This transaction is expected to be completed within the current financial year, subject to regulatory approvals, it added.
Subsequently, “Nippon Life Insurance will have an option to increase its stake further by an additional 14 per cent, to reach 49 per cent, in tranches.”
“We welcome Nippon’s decision to further strengthen this partnership and acquire an additional stake in our asset management company. We strongly believe their expanded role in the company will accelerate our growth, reach and performance, said Reliance Capital CEO Sam Ghosh.
“Our partnership with the Reliance group is an exemplary example of successful collaboration between two big corporations and countries. We look forward to strengthening this relationship and using the collective experience of the two corporations to the advantage of the two global economies”, said Nippon Life Insurance President Yoshinobu Tsutsui.
RCAM is the largest asset manager in India managing Rs.2,18,338 crore as on September 30, 2014.
