Allianz plans to exit joint venture with Bajaj due to cooperation dispute

Allianz SE is in talks to terminate two Indian joint ventures with Bajaj Finserv Ltd. amid disputes over the direction of the partnership, people familiar with the matter said.

Allianz plans to exit Bajaj Allianz Life Insurance Co. and Bajaj Allianz General Insurance Co. because its Indian partner will not allow the German Insurance companies added shares at a discount. Not public. It also had no say in strategic decisions, they said.

While disagreements between the two companies have been simmering for years, the latest standoff has brought the two joint ventures to the brink of collapse over two decades ago. Allianz is now looking to buy a stake in the newly formed insurance company to retain its presence in the fast-growing South Asian country, two people familiar with the matter said, without providing further details. Bajaj holds 74% stake in the joint venture with Allianz.

“Allianz has informed Bajaj that it is actively considering exiting its life and general insurance joint ventures given its strategic priorities,” Bajaj Finserv said in a statement after the Bloomberg News report. “It has indicated that it remains committed to in the Indian insurance market, but will not speculate on alternatives.” A Munich spokesman said earlier that Allianz would not comment on market rumors.

The discussions were preliminary, the statement said, adding that Allianz would fully support a smooth transition if it exits the joint venture.

Shares of Bajaj Finserv fell 1.8% in Mumbai before recouping some losses.

India’s insurance penetration (the ratio of premiums to gross domestic product) is less than half that of countries such as South Africa and Canada, suggesting strong growth prospects for the industry, according to insurance regulator data.

Bajaj Allianz General Insurance Company is the third largest insurance company in India in terms of total written premiums, while Bajaj Allianz Life Insurance Company is one of the fastest growing insurance companies with assets under management of Rs 1 trillion as on March 31 (119 billion U.S. dollars). Exchange filing.