Housing Development Finance Corporation (HDFC) Ltd., India’s largest mortgage financier announced on 19 June, 2019 that its going to buy a stake of 51.2% in Apollo Munich Health Insurance company for Rs 1,347 crore of estimated amount.
Apollo Munich is actually, a German reinsurance company owned by Munich Re. Munich Re formed the joint venture with Apollo Hospitals and Apollo Energy which are Chennai based.
As a result of this merge with HDFC and termination of their joint venture, Munich Re will pay ₹294 crore to Apollo Hospitals and Apollo Energy.
Initially in the first stage of the deal, Apollo Munich would be held as a subsidiary of HDFC Ltd. In the second stage it would be merged with HDFC ERGO General Insurance. HDFC is seeing this merger as a profit in the near future and assured that it will create a string health insurance franchise with gross direct premium of estimated amount of Rs 10, 807 crore.
HDFC also released a statement saying, “The merged insurance entity on a pro-forma basis has a
combined market share of 6.4 percent of non-life insurance industry, with 308 branches across the country. This also makes the combined entity the second largest private insurer in the accident & health segment with a market share of 8.2 percent.”
HDFC was founded in 1977 in India as the first specialised mortgage company. It is based in Mumbai, India and was founded by Hasmukhbhai Parekh.