The Hindu Business Line : Bank of Rajasthan moves out — Allahabad Bank's insurance venture equity restructured

THE general insurance joint venture mooted by Allahabad Bank, which originally had Bank of Rajasthan (BoR) as one of its stakeholders, will now have a new equity-sharing arrangement.

BoR has moved out and its 10 per cent allotment will be farmed out among the main promoter, IOB, Karnataka Bank and the Dabur group.

The new structure will see Allahabad Bank controlling 30 per cent in the company, with IOB and Karnataka Bank holding 19 per cent and 15 per cent respectively. Ten per cent will be held by Dabur.

Mr Onkar Nath Singh, Chairman of Allahabad Bank, said 26 per cent stake in the proposed company will be held by a foreign insurance outfit.

"We hope to announce the details soon. It is expected that the company will be in place by June," he told newspersons.

Allahabad Bank, which had mandated consultant Ernst & Young to assist in the insurance proposal, intends to start with an authorised capital of Rs 200 crore. It will also go ahead with an IRDA filing after the Budget.

The latest arrangement will lead to another MoU to be signed by the four domestic partners. Dabur, the only private sector partner, has co-promoted a life insurance business with Aviva.

To raise Rs 500 cr:Meanwhile, Allahabad Bank has informed the stock exchanges that it proposes to raise Rs 500 crore by way of Tier-II capital.

Three foreign cos shortlisted

ALLAHABAD Bank has listed three overseas companies - Sampo of Japan, Axa of France and Insurance Australia General - one of which may come in as a 26 per cent shareholder in the new company.

The three have evinced keen interest in the proposal, Mr Singh said, adding that the shortlisted outfits had been chosen from among several foreign players with which initial discussions were held.

Of the three, Axa has in recent days shown interest in a life insurance venture with telecom major Bharti.

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