Abrdn readies HDFC Life exit
Abrdn (formerly Standard Life Aberdeen Plc), through its subsidiary Abrdn (Mauritius Holdings) 2006 Ltd, owned a 1.7% promoter stake in HDFC Life as on 31 March. The Indian promoter HDFC Ltd owns a 48.65% in the private insurer.
PremiumMUMBAI : HDFC Life Insurance Co Ltd’s foreign joint venture partner Abrdn Plc, on Tuesday put its remaining stake comprising 35.7 million shares on the block, marking its exit from India’s life insurance space after 23 years. It has valued its holding at ₹2,088.64 crore, or ₹563- 585 per share.
Abrdn (formerly Standard Life Aberdeen Plc), through its subsidiary Abrdn (Mauritius Holdings) 2006 Ltd, owned a 1.7% promoter stake in HDFC Life as on 31 March. The Indian promoter HDFC Ltd owns a 48.65% in the private insurer.
The Edinburgh-headquartered investor has offered to sell its shares at a discount of up to 3.75% to Tuesday’s closing on the NSE.
Bank of America is the sole bookrunner for Abrdn’s stake sale, Bloomberg reported.
Among 23 private life insurers, HDFC Life is India’s second largest with a 7.8% market share. The company collected new business premium worth ₹23,876.54 crore in FY23, up 19% from ₹24,301 crore in the previous financial year.
Through its JV with mortgage lender HDFC in 2000, Abrdn is the oldest foreign JV partner of a life insurer in India ever since the sector was liberalized in 1999.
In July 2021, the UK-based investment management firm changed its name from Standard Life Aberdeen to Abrdn.
However, soon after HDFC Life’s listing on the exchanges in November 2017, it started trimming its stake gradually. HDFC Life commands a market cap of ₹1.25 trillion.
The first tranche of Abrdn’s stake sale began in January-March 2018, according to regulatory filings. Between January 2019 and June 2020, it slashed its stake by 18.96% to bring it down to 10.27%. During October 2020-June 2021, Abrdn lowered its stake further by 6.38%. In June 2021, Standard Life divested a 5% stake in the life insurance firm in two tranches for ₹672 and ₹673, respectively, to mop up ₹6,784 crore. In January-September 2022, Abrdn’s stake was down by 2.23%. It subsequently sold another 2.06% to bring its holding down to 1.7%, which was put on the block on Tuesday. Abrdn is also looking to exit its stake in HDFC AMC.
On 16 August, 2022 Abrdn had sold 6% of its stake as a sponsor in the country’s largest mutual fund HDFC Asset Management Co., trimming its holding to 10.21% in the AMC.
Subsequently, on 6 December, 2022, Abrdn Investment Management (formerly Standard Life Investments), announced its plan to offload its entire 10.2% stake in the mutual fund house. The other sponsor is HDFC, which holds a 52.59% stake.
Abrdn plc is primarily engaged in managing investments in equities, multi-asset, fixed income, liquidity, sovereign wealth funds, real estate and private markets.
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