HDFC ERGO acquires Indian non-life insurer L&T General Insurance

Press release 3 June 2016

HDFC ERGO General Insurance Company (HDFC ERGO), Mumbai, India, purchases 100 percent of L&T General Insurance Company Ltd. (LTGI) from Larsen & Toubro Ltd. Representatives of both companies signed a share purchase agreement today. The parties agreed on a purchase price of INR 551 cr (74 million euros). Hereby ERGO further strengthens its engagement in India as a focus market, after recently increasing its shareholding in HDFC ERGO to 49 percent.

 HDFC ERGO as India’s fourth largest private non-life insurance company strengthens with the acquisition its presence in the market. LTGI is no. 14 in the private non-life insurance market in India. It offers motor, fire, health and other insurance products primarily to retail customers. As HDFC ERGO’s long term strategy is to grow in motor, health and open market business, the acquisition of LTGI fits its strategy. HDFC ERGO will get access to particular distribution channels and strengthen its market position in India to become no. 3 amongst the private insurers. HDFC ERGO expects the Indian non-life market to continue to grow about 15 percent p.a. over the next ten years.

LTGI’s net loss ratio of 72 percent in 2014/15 was below the market average of 82 percent. The company recorded a premium income equivalent to 64 Million euro in the last financial year. LTGI employs about 832 employees. Its distribution channels include more than 2,000 sales agents.

Closing of the acquisition is subject to regulatory approval customary for transactions of this type. This would be the first transaction of this kind between two market players in the Indian insurance market since market liberalisation in 2000.

For further information, please contact:
Florian Amberg

ERGO Insurance Group
Media Relations
Florian Amberg

Tel +49 211 477-3174
Fax +49 211 477-3113

About the ERGO Group AG 
ERGO is one of the major insurance groups in Germany and Europe. Worldwide, the Group is represented in over 30 countries and concentrates on Europe and Asia. ERGO offers a comprehensive spectrum of insurance, provision and services. In its home market of Germany, ERGO ranks among the leading providers across all segments. About 43,000 people work for the Group, either as salaried employees or as full-time self-employed sales representatives. In 2015, ERGO recorded a premium income of 17.9 billion euros and rendered benefits to customers of 16.8 billion euros. ERGO is part of Munich Re, one of the world's leading reinsurers and risk carriers.
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HDFC ERGO General Insurance Company Ltd. is a 51:49 joint venture between HDFC Ltd., India’s premier Housing Finance Institution and ERGO International AG, the primary insurance entity of Munich Re. The Company offers complete range of general insurance products ranging from Motor, Health, Travel, Home and Personal Accident in the retail space and customized products like Property, Marine and Liability Insurance in the corporate space. HDFC ERGO is expanding its network across the country and is today present in 108 branches spread across 91 cities with an employee base of over 2000 professionals. The Company also has a wide distribution network comprising of brokers, retail and corporate agents and bancassurance besides its own direct sales force.

About HDFC
HDFC ltd is India’s first retail housing finance company and is currently one of the largest originators of housing loans in the country. HDFC has financed 5.4 million housing units. 77 percent of shareholders in HDFC are foreign investors. Over the years, the HDFC group has emerged as a strong financial conglomerate with a presence in banking, life and general insurance, asset management, venture capital and education finance. Besides HDFC Ergo General Insurance Company Limited, HDFC’s key associate and subsidiary companies include HDFC Bank Limited, HDFC Standard Life Insurance Company Limited, HDFC Asset Management Company Limited, GRUH Finance Limited, HDFC Venture Capital Limited and Credila Financial Services Limited.

This press release contains forward-looking statements that are based on current assumptions and forecasts of the management of ERGO Group. Known and unknown risks, uncertainties and other factors could lead to material differences between the forward-looking statements given here and the actual development, in particular the results, financial situation and performance of our Company. The Company assumes no liability to update these forwardlooking statements or to conform them to future events or developments.

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