According to persons familiar with the situation, Jio Financial Services Ltd., which is owned by billionaire Mukesh Ambani, has discussed forming an insurance partnership with Allianz SE in India as the German company looks to end two current joint ventures in the nation.
According to insiders who asked not to be named since the information is confidential, Jio Financial and Allianz are seeking to open a general insurance and a life insurance business in the South Asian country. According to the persons, the talks are still in their early phases, and either party may decide not to move forward with the idea.
After Bloomberg News revealed the potential split, Bajaj Finserv Ltd. released a statement on Tuesday stating that the Munich-based company has told its present partner that it is “actively considering an exit” from the operations. The statement claims that Allianz “has indicated that it remains committed to the Indian insurance market.” A disagreement over the partnership’s course is at the heart of the split, according to several with knowledge of the situation.
According to a Jio Financial representative, the company is unable to address rumors. “We will continue to make necessary disclosures in accordance with our obligations, as we always have, if and when there are any material developments with respect to the company,” the spokesperson continued. According to a spokesman from Munich, Allianz does not comment on market rumors.
Under the leadership of seasoned banker K.V. Kamath, Jio Financial has partnered with BlackRock Inc. to launch an asset management company in addition to operating a shadow bank and insurance brokerage. The Ambani unit’s goal of growing into a financial services giant would be aided by the establishment of insurance operations.
India has a tremendous development potential because its insurance penetration rate, or the ratio of premiums to GDP, is less than half that of nations like South Africa and Canada.