Mahindra Fin to sell 5% in insurance broking arm for Rs 65 cr

Mahindra Finance will sell 5 per cent stake in its subsidiary Mahindra Insurance Brokers Ltd (MIBL) to partner Inclusion Resources (IRPL) for Rs 65 crore.

Mahindra Finance said it has received an approval from the sectoral regulator Insurance Regulatory and Development Authority of India (Irdai) earlier this month for this deal.

Pursuant to Irdai nod, the company has entered into a share purchase agreement (SPA), a shareholders agreement and other ancillary agreement with IRPL and MIBL.

"Under the SPA, the company (Mahindra Finance) proposes to sell and IRPL proposes to purchase 1,28,866 equity shares of MIBL corresponding to 5 per cent of MIBL's total issued and paid up share capital," Mahindra Finance said in a regulatory filing.

As on date, Mahindra Finance holds 21,90,692 equity shares corresponding to 85 per cent of MIBL's issued and paid up share capital and IRPL holds 3,86,598 equity shares corresponding to 15 per cent of MIBL's total issued and paid- up share capital.

Mahindra Finance said it will receive Rs 65 crore for this deal.

Post completion of the deal, Mahindra Finance's aggregate shareholding in MIBL will reduce to 80 per cent while IRPL's stake will rise to 20 per cent.

Mahindra & Mahindra Financial Services Ltd (Mahindra Finance), a part of the Mahindra Group, is engaged in non- banking financial business focused on rural and semi-urban sector.

Mahindra Finance stock closed 2.85 per cent up at Rs 431.45 on BSE today.

(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)