The Competition Commission of India Friday said it has approved mortgage major Housing Development Finance Corporation Ltd.'s acquisition of 51.2 percent stake in Apollo Munich Health Insurance and subsequently merger of the latter into HDFC Ergo in a deal worth nearly Rs 1,347 crore.
In June, HDFC agreed to acquire Apollo Hospitals Group's entire 50.8 percent stake in Apollo Munich Health for Rs 1,336 crore and also the 0.4 percent stake held by a few employees for Rs 10.84 crore.
HDFC Chairman Deepak Parekh had said the deal will have two steps -- HDFC first acquiring 51.2 percent in Apollo Munich Health and then merging it with HDFC Ergo.
The merger with HDFC Ergo will create a strong health insurance franchise with combined gross direct premium of Rs 10,807 crore, Parekh had said.
In a tweet, the fair trade regulator said it “approves the acquisition of 51.20 percent shareholding of Apollo Munich by HDFC and subsequently merger of Apollo Munich into HDFC ERGO”.
Munich Health, the health business arm of Germany-based Munich Re, owns 49 percent stake in Apollo Munich Health, while Ergo International AG, another subsidiary of the German major, owns 49 percent stake in HDFC Ergo.
HDFC Ergo is the general insurance arm of HDFC.
Combinations beyond a certain threshold require clearance from the CCI.
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