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Max Life, HDFC Life 'committed to merger', weighing options

Section 35 of the Insurance Act, 1938 doesn't allow merger of insurance firm with non-insurance firm

Press Trust of India  |  New Delhi 

Max Life, HDFC Life 'committed to merger', weighing options

on Thursday said Max Life and Life remain committed to the and are evaluating various options after the regulator again expressed reservations on the deal.

In November last year, had posed reservations on the present form of amalgamation of Max Life and Life into a single entity to comply with Section 35 of the Act, 1938.

Section 35 of the Act, 1938 does not allow the of an firm with a non-firm.

"Further to the representations made to the Regulatory & Development Authority of (Irdai), the Authority on June 7 reaffirmed its original position regarding section 35 of the Act, 1938," said in a regulatory filing.

It said: "Life and remain committed to and evaluating various options."

The scheme of amalgamation proposes merging of business in an agreement between Max Financial Services Ltd (MFSL), its subsidiary Max Life Company Ltd (MLIC), Standard Life Company Ltd (Life) and

Life and MLIC had filed an application seeking in-principle approval of for the proposed amalgamation scheme on September 21, 2016.

In a complex and tier-structured demerger and plan, will amalgamate Max Life with Max Financial Services.

Subsequently, the business of the merged entity is to be demerged so that it can be transferred to Standard Life Company.

As per the proposed scheme, the remaining of the merged entity i.E., minus the business, will be amalgamated with

Max Financial Services, promoted by USD 2 billion Max Group, is the holding company for Max Life.

First Published: Thu, June 08 2017. 14:07 IST