Sebi issues notice to Axis Bank over stake purchase in Max life insurance: Details (Image Source: iStock)
New Delhi: Capital market regulator Securities and Exchange Board of India has issued a show cause notice (SCN) for axle bench and its subsidiaries in a case related to the purchase of a stake in Max Life Insurance. In a regulatory filing, Axis Bank said the SCN was issued on October 25 via email.
Axis Bank and its subsidiaries, Axis Securities Limited and Axis Capital Limited, received an SCN via email from Sebihe said. The SCN is being reviewed and will submit responses to the SCN with Sebi as the said transactions were carried out with required regulatory approvals, it said.
Meanwhile, Max Financial Services Limited, the holding company of Max Life Insurance also said that some directors and some members of the company’s key management personnel (in each case, “both past and present) have received an SCN by email from Sebi.
Earlier this year, Axis Bank’s board of directors approved the proposal to acquire shares of Max Life, raising the total stake of Axis entities in the insurance firm to 19.99 per cent from 19.02 per cent. The Insurance Regulatory and Development Authority of India (IRDAI) allowed Axis Bank and its two subsidiaries – Axis Capital Ltd and Axis Securities Ltd – to collectively own around 20 per cent of Max Life Insurance.
The stake was acquired as part of a deal closed in 2021 between Axis Bank and Max Life Insurance. Last year, Axis Bank entered into a revised agreement with Max Financial Services to acquire an additional 7 per cent stake in Max Life Insurance at fair market value using the discounted cash flow method. The review of the agreement follows the guidelines issued by the IRDAI in October 2022.
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