South African based insurer MMI will initially own 26% stake in the joint venture.
Aditya Birla Financial Services Group (ABFSG) has entered into a Memorandum of Understanding (MoU) with South African based insurer MMI Holdings to enter the health insurance market in India, said a press release issued by the company.
Ajay Srinivasan, Chief Executive - Financial Services, Aditya Birla Group says, “'Health insurance has low penetration levels in India. Given ABFSG’s focus on building a retail presence across products, we foresee a huge potential to target the requirements of untapped customers and their families. Our partnership will give us the competitive edge given MMI's expertise in the health insurance sector.”
Nicolaas Kruger, Group CEO of MMI says, 'MMI considers India as an important strategic market for its international expansion strategy. MMI believes health insurance is a very attractive entry point into India. 'We are confident that this relationship between MMI and ABFSG will lead to the establishment of a successful health insurance business in India.”
MMI will initially own 26% stake in the joint venture. The company intends to raise its stake in the joint venture to 49% if the government raises the FDI cap in insurance sector, said a press statement.
FirstRand Bank India, Rand Merchant Bank and Webber Wentzel attorneys will serve as advisors to MMI for this initiative.