Life Insurance Corporation of India is in discussions to acquire as much as half the stake in ManipalCigna Health Insurance, as the country’s largest insurer seeks an entry into the fast-growing, yet underserved, market for medical expenses coverage, people familiar with the matter said.
ManipalCigna is a joint venture between Manipal Education & Medical Group and US-based Cigna Corporation.
Preliminary Talks
The Bengaluru-based group holds a 51% stake in the standalone health insurance company, while Cigna Corporation owns the remaining 49%.
If a deal is finalised, it will allow state-run LIC to diversify from its life insurance portfolio and tap into the increasing demand for health insurance that constitutes 37% of the ₹3 lakh crore general insurance industry. “Both parties have signed a non-disclosure agreement and are moving forward with discussions for LIC to acquire approximately a 50% stake in the venture,” said a person familiar with the matter, adding: “As per preliminary talks, both Manipal Group and Cigna Corporation will reduce their stakes proportionately.”
The deal could value the health insurer around₹4,000 crore, another person said.
A ManipalCigna spokesperson declined to respond to questions on what he termed “market speculation”, while an LIC spokesperson did not reply to a request for comment.
LIC has been looking to enter the health insurance market. “Our groundwork is underway, and within this financial year, we expect to acquire a stake in an existing standalone health insurance provider,” managing director and chief executive Siddhartha Mohanty said during the company’s earnings call on November 8, without divulging fu
