On Thursday, Housing Development Finance Corporation (HDFC) said in a stock exchange filing that the Insurance Regulatory and Development Authority of India (IRDAI) vide its letter dated 11 November 2020, has given its final approval for the merger of HDFC ERGO Health with and into HDFC ERGO.
In September, the mortgage lender had received approval from the National Company Law Tribunal, Mumbai (NCLT) that it has sanctioned the Scheme of Amalgamation between HDFC ERGO Health Insurance Limited (formerly Apollo Munich Health Insurance Company Limited) (HDFC ERGO Health or Transferor Company) and HDFC ERGO General Insurance Company Limited (HDFC ERGO or Transferee Company).
The general and health insurance companies are the subsidiaries of HDFC Ltd.
As per the scheme of amalgamation through a share swap deal, there will be a dissolution of HDFC ERGO Health without winding up.
Under this, the share exchange ratio of 100:385 has been okayed by the board of the subsidiary companies which would mean allocation of 385 shares in HDFC ERGO Health for 100 shares in HDFC ERGO.
Post completion of the merger, HDFC will hold 50.58 percent stake in HDFC ERGO.
"The board of directors of HDFC ERGO and HDFC ERGO Health...approved the share exchange ratio of 100:385 that is for every 385 shares of ₹10 each held in HDFC ERGO Health as on the record date, 100 shares of Rs 10 each of HDFC ERGO would be allocated," HDFC said in January this year.
Before this, HDFC ERGO acquired a majority shareholding in Apollo Munich Health Insurance Co Ltd.