State-run Union Bank of India has decided to sell nearly 40% stake in its mutual fund arm to Japan’s 115-year old insurer, Dai-Ichi Life Insurance company, said a recent regulatory filing.
Initially, Union Mutual Fund had a JV agreement with Belgium’s KBC in December 2009. However, it was called off in 2015. After two years, Union MF has found a new partner in Japan’s Dai-Ichi Life Holdings.
In a statement, Union Bank said, "Considering the present equity investment of Union Bank of India in Union Asset Management Company, the investment of Dai-Ichi Life would be 39.62 per cent on fully diluted basis post conversion to equity."
Commenting on the road map for this new partnership juncture, G Pradeep Kumar, CEO, Union MF, said, “Union Bank has a ten-year relationship with Dai-Ichi Life Insurance in Star Union Dai-Ichi Life Insurance company. We therefore decided to extend this relationship by joining hands with them in the AMC business as well. We are expecting that the absorption of best business practices and expertise will mutually benefit this venture.”
Considering the fact that Dai-Ichi Holdings has a global presence, Pradeep Kumar also indicated that there could be international business opportunities for Union AMC.
The total average asset under management (AUM) of the Union Mutual Fund stood at Rs 3,811 crore as on September, 2017.
