Religare-Swiss Re JV plans go bust

The proposed health insurance

Joint venture (JV) between Religare Enterprises and the world’s second-largest reinsurer Swiss Re has fallen through. This is the second such proposed JV that has come unstuck for Religare, who had earlier parted ways with Dutch financial company Aegon in the mutual fund business. Incidentally, Swiss Re had agreed to buy a 26% stake in the health company at a significant premium, which would meet a large part of the company’s capital requirements. Swiss Re is already present in the Indian market through a 26% stake in TTK Healthcare Services, a health insurance third-party administrator.

Swiss Re will continue to explore a health insurance JV. It is awaiting the passage of the insurance bill, which will enable itself (foreign insurance companies) to hold 49% in Indian counterparts as against the current 26% stake.

The two companies had signed a non-binding term sheet to develop a health insurance JV in India on June 1, 2009. But they have mutually decided not to renew their agreement, which expired on August 20. Both companies have now decided to charter their growth plans in their respective areas, in alignment with their independent strategies and goals. crackcrack