Nalanda Capital-backed Exide Industries Ltd (EIL), a manufacturer of automotive lead-acid batteries and provider of stored energy solutions, is acquiring the remaining 50 per cent stake in ING Vysya Life Insurance Company Ltd (IVL) for around Rs 550 crore ($102.5 million).
Exide is buying the minority stake held by ING Group (26 per cent), former promoter of financial services firm DSP- Hemendra Kothari Group (16.32 per cent) and Enam Group (7.68 per cent).
Post acquisition, Exide will induct a new international player in the life insurance venture to infuse fresh equity into the business.
In July 2005, Exide bought 50 per cent stake in IVL for $47 million from GMR Industries Ltd in a deal which valued it at $94 million. The latest deal values the insurance firm at $205 million.
Bangalore-headquartered IVL is currently present in over 232 cities. It offers protection, savings or investment, and retirement plans for individuals and families. It is a relatively mid-sized private player in the industry and does not figure among the top ten private insurers. The market is already dominated by PSU heavyweight LIC.
Kolkata-based Exide (formerly known as Chloride Industries, Ltd) manufactures and sells lead acid storage batteries for automotive, industrial and submarine applications. It is the largest player in the business and much ahead of the No. 2 firm Amara Raja Batteries, which is backed by Sequoia Capital. The company has six factories located across the country, in Maharashtra, West Bengal, Tamil Nadu and Haryana.
In March last year, Exide had acquired the home inverter business of Kevin Power Solutions Ltd for an undisclosed amount from Kevin Power Solutions Ltd.
A year ago, Nalanda Capital had increased its holdings in Exide Industries to 5.01 per cent, making it one of the single biggest investments in India for the Singapore-based private equity firm. It is estimated to have put in over $100 million to buy shares of Exide through open market purchases.
This is yet another deal in the life insurance business. A little over a year ago, Japan’s largest life insurance firm Nippon Life Insurance Company had picked 26 per cent in Reliance Life Insurance for Rs 3,062 crore ($680 million), valuing the seventh largest Indian life insurer at approximately Rs 11,500 crore ($2.6 billion).
(Edited by Prem Udayabhanu)