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Reliance Capital, a part of the Anil Ambani-led Reliance Group, has completed the transaction for receipt of approximately Rs 1,200 crore ($180 million) from Nippon Life Insurance for an additional
14 per cent stake sale in Reliance Capital Asset Management (RCAM).
Nippon Life Insurance (NLI), a Fortune 500 company and one of the largest life insurers in the world, now becomes a co-sponsor of Reliance Mutual Fund along with Reliance Capital, and will own 49 per cent in Reliance Capital Asset Management.
The board of directors of Reliance Capital Asset Management, in a meeting held here today, approved the transfer of an additional 9.57 per cent stake to Nippon Life Insurance, with the balance 4.43 per cent to be transferred in the next couple of weeks.
The transaction pegs the valuation of Reliance Capital Asset Management at Rs 8,542 crore ($1.3
billion), the highest valuation till date for any asset management company in the country. In line with the new shareholding, the name of Reliance Capital Asset Management would also be changed to Reliance Nippon Life Asset Management.
Nippon Life Insurance is already a strategic partner in Reliance Capital Asset Management. The Japanese company acquired 26 per cent stake in Reliance Capital Asset Management at an aggregate value of Rs 1,450 crore ($240 million) in 2012. The transaction pegged the total valuation of Reliance Capital Asset Management at approximately Rs 5,600 crore ($920 million). Subsequently, the Japanese company increased its stake by 9 per cent to 35 per cent in February 2015 at an aggregate value of Rs 657 crore ($108 million) that pegged the valuation of Reliance Capital Asset Management at Rs 7,300 crore ($1.2 billion).
Nippon Life Insurance is an over 125-year-old insurer and a Global Fortune 500 company that manages over $520 billion (Rs 33.8 lakh crore) in assets, amongst the largest total assets in the world for any life insurer. The company is one of the largest life insurers in the world.
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