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Informist, Friday, Oct. 11, 2024

 

MUMBAI – The transaction under the re-insurance treaty between Bajaj Finserv Ltd.'s subsidiary Bajaj Allianz General Insurance Co and Allianz SE will have to be considered as a related party transactions under the listing regulations, Securities and Exchange Board of India said in reply to a query from Bajaj Finserv under the informal guidance scheme of the market regulator. This will, however, be subject to the materiality threshold. If, in the re-insurance treaty, the value of the transfer of resources as net settlement amount in a financial year is more than the lower of the two amounts of INR 10 bln or 10% of annual consolidated turnover it will have to be treated as material related party transaction.

 

Bajaj Finserv Ltd holds 74% equity capital of Bajaj Allianz General Insurance and Allianz SE holds remaining 26%. The company was unsure whether SEBI's provisions with respect to material related party transactions would apply to its subsidiary's re-insurance treaty with Allianz SE. According to Bajaj Finserv, Allianz SE was not its related party but that of its subsidiary Bajaj Allianz General Insurance.

 

SEBI also said as per the related party provisions in the listing regulations, a prior approval of shareholders of a listed entity will have to be taken for all material related party transactions. If the value of the treaty between Bajaj Allianz General Insurance and Allianz SE meets the materiality threshold, Bajaj Finserv will have to take approval of its shareholders.  End

 

Reported by Rajesh Gajra

Edited by Akul Nishant Akhoury

 

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