Merger in Insurance Sector: Prime Life, Union Life, and Gurans Life sign final merger deal
It has been agreed that Sulav Agrawal, the current Chairman of Union Life, will be the Chairman of Himalayan Life. Similarly, Manoj Lal Karn, the current CEO of Union Life, will lead the new entity as the CEO. Bipin Kumar Lal, CEO of Gurans Life and Nirmal Dahal, CEO of Prime Life will take the roles of Senior Deputy CEOs in Himalayan Life.
The final merger deal between the three life insurers followed the signing of the initial agreement for the merger between two non-life insurance companies- Ajod Insurance and United Insurance - on January 11. The Ajod-United merger initiative has come after Ajod's unsuccessful merger attempt with Prabhu Insurance. United and Ajod agreed on a swap ratio of 100:90. The name of the entity formed after the merger will be United Ajod Insurance. Earlier, Ajod and Prabhu Insurance signed a merger agreement in the last week of July 2022. However, the proposed merger did not materialize as both companies could not agree on the swap ratio. With the Nepal Insurance Authority pushing for a consolidation drive by raising the minimum paid-up capital requirements for both life and non-life insurers, insurance companies have ratcheted their merger initiatives. The authority has increased the paid-up capital of non-life insurance companies to Rs 2 billion while it is Rs 5 billion for life insurance companies. The Nepali insurance sector has already seen two successful mergers in 2022. In July, Himalayan General Insurance and Everest Insurance merged to form Himalayan Everest Insurance Co. Ltd. Similarly, in October, Sanima General Insurance and General Insurance Company merged to form Sanima GIC Insurance Ltd.
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