New Delhi, July 7 (IANS) Fertiliser cooperative Indian Farmers Fertilizer Co-operative (IFFCO) said it will divest a 21.64% stake in its insurance joint venture IFFCO Tokio General Insurance Company Ltd to its Japanese partner Tokio Marine Asia Pte Ltd for Rs 2,380.40 crore. Along with IFFCO, Indian Potash Ltd (IPL) will also divest a 1.36% stake. Following the acquisition of 23% stake for Rs 2,530 crore from both the companies, Tokio Marine's stake in the general insurer would go up to 49%.
The per share value of IFFCO Tokio General is Rs 408,43. "This is a good opportunity for IFFCO to unlock the valuation of its investment in IFFCO-TOKIO by sale of its part shareholding. This transaction would help IFFCO in raising the required capital to focus on more agri-businesses and to better serve the interests of the Indian farmers in the fast changing agriculture sector in India," IFFCO Managing Director U.S. Awasthi was quoted as saying.
Awasthi added, "Even after the divestment, IFFCO will continue to exercise control in the business affairs of IFFCO-TOKIO in compliance with IRDA's Guidelines on 'Indian Owned and Controlled' Insurance Companies."
The CEO of Tokio Marine Asia Arthur Lee said, "The additional share purchase is in line with Tokio Marine Group's international business strategy to achieve sustainable growth and profit expansion as well as enhance diversified business portfolio through capturing growth opportunities in emerging countries." As on March 31, 2017, IFFCO and its associate IPL were holding 72.64% and 1.36% paid up share capital in IFFCO TOKIO, whereas Tokio Marine was holding 26% paid up share capital in the company.