Max gives option to New York Life to raise stake

If permitted by applicable law, the foreign partner can increase its shareholding in the Max New York Life Insurance by up to 24 per cent from the from existing level, Max India informed the Bombay Stock Exchange.

Max India said it has restructured its joint venture agreement whereby the foreign partner has been given option of increasing its shareholding in the insurance venture to 49 per cent.

As per the existing guideline, a foreign entity cannot hold more than 26 per cent stake in an insurance venture in India.

Max New York Life Insurance is a 74:26 per cent joint venture between Max India Ltd and New York Life International.

The option of increasing stake is available to the foreign partner for a period of 8 years from the date of the amended joint venture agreement, it said.

Stake increase will be priced on a fair market value based formula less discount of 10 per cent as against an earlier preferential formula, it added.