South African life insurance major Sanlam wants to increase its 26% stake in Shriram Capital to 49%, subject to approval from Indian regulators. The company is also keen to get a banking licence in India.
Sanlam chief executive Johan Van Zyl said the company has set aside R50 crore of its R400 crore discretionary budget to raise its stake in Shriram Capital as it sees opportunity in high growth markets in Asia.
The company wanted to acquire a bigger shareholding in Shriram for some time now but has been held back by the strict regulations on foreign ownership of insurance companies in India.
However, Van Zyl is buoyant about the possibility of the threshold for foreign ownership being increased to 49% soon. Shriram Capital provides life insurance, vehicle finance, retail stock broking and financial advisory services to a huge number of middle class customers in India.
Sanlam is keen on acquiring a banking licence in India and has set aside a billion rand for this purpose, Van Zyl said, adding the company is eyeing not only India, but also Malaysia, where it is looking for a life insurance partner. The company already has a 49% stake in Malaysian short-term insurer Pacific and Orient Insurance Company Berhad.