ERGO and Avantha sign joint venture agreement in ... - Avantha Group

Press release – New Delhi, India, 1 November 2012
ERGO and Avantha sign joint venture agreement in India
Highlights
Launch of Avantha ERGO Life Insurance announced
To be named Avantha ERGO life Insurance Company
Ltd.
JV signed by Gautam Thapar and Dr. Jochen
Messemer
Business operations to start beginning of 2014
Avantha to hold 74% stake and ERGO to hold 26%
stake.
Contact:
Shravani Dang
Tel: +91 11 41699282
Mobile: +91 9811 261080
Email: s.dang@avanthagroup.com
www.avanthagroup.com
Avantha Group
Thapar House, 124 Janpath, New Delhi-
110001
Alexandra Klemme
Tel +49 211 477-3003
alexandra.klemme@ergo.de
www.ergo.com
ERGO Versicherungsgruppe AG
Victoriaplatz 2, 40198 Düsseldorf,
Germany
The ERGO Insurance Group and the Avantha Group
announce a joint venture in India. The joint venture will offer
a wide range of flexible life insurance products. The
agreement was signed today by Gautam Thapar, Chairman
and CEO of Avantha, and Dr. Jochen Messemer, Chairman
of the Board of ERGO International AG. The new company is
expected to start business operations at the beginning of
2014, subject to regulatory approval.
The company will be named Avantha ERGO Life Insurance Company
Ltd. and will operate as a Greenfield joint venture. The Avantha Group
will hold a 74% stake and ERGO will have an initial stake of 26%,
currently the maximum possible shareholding for a foreign investor in an
Indian insurance company. ERGO aims to increase its shareholding
once the regulatory framework allows it to do so.
The life insurance joint venture, with its head office in Mumbai, will
primarily offer unit-linked and traditional insurance products to its
customers. The Joint venture will primarily leverage – among others –

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Press release
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ERGO’s expertise in product development, multi distribution approaches
and risk management, and will be complemented by Avantha’s strong
Indian heritage and its reputation as a leading Indian corporate house.
With this strategic move, ERGO strengthens its presence in India and
continues to pursue its international growth strategy with a focus on the
emerging Asian markets. Dr. Jochen Messemer is convinced of the
perfect match of the two partners: “When expanding our international
business by the way of partnership, we look very carefully for partners
who share our long-term view and sustained business approach. We
are convinced that Avantha is a perfect partner with a strong cultural fit.
Furthermore, we believe that the fundamentals in the Indian life
insurance market are attractive after a series of regulatory adjustments
over the last two years.”
With the announcement of reforms in this sector, which now seeks to
provide a fostering environment for the growth and development of this
industry as well as more customer-friendly measures, the Avantha
Group considers the timing and the partnership match to be ideal.
Gautam Thapar expects a very successful partnership with ERGO and
points out: “We are convinced that we are teaming with one of the
world’s most renowned partners for the life insurance business in India.
With ERGO’s extensive insurance know-how and Avantha firm roots in
the Indian market, we will build up a successful business.”
The partners are confident that the market offers long-term growth and
profit potential to existing and new players despite the recent challenges
and market contraction in the Indian life insurance market. India
currently represents more than 17% of the world’s population, but it
contributes only 2% of total life insurance premiums. This is why the
Indian life insurance market is highly attractive for new private players.
Avantha Group is one of India’s leading business conglomerates with
20,000 employees. The Group has business interests in diverse areas,
including pulp and paper, power transmission and distribution
equipment and services, food processing, farm forestry, chemicals,
energy, infrastructure, information technology (IT) and IT-enabled
services.
ERGO is one of the major insurance groups in Europe and part of
Munich Re, one of the world’s leading reinsurers and risk carriers.
Worldwide, ERGO is represented in over 30 countries and concentrates
on Europe and Asia. The new life insurance joint venture will broaden
ERGO’s product portfolio in India: Via HDFC ERGO, which is a joint
venture with HDFC Ltd., ERGO already offers non-life insurance
products. The company is one of the top four private non-life insurers in
the country.

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Press release
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Avantha Media Relations. Shravani Dang
Tel: +91 11 41699282
ERGO Media Relations, Alexandra Klemme
Tel +49 211 477-3003
About Avantha
The US$ 4 bn Avantha Group is one of India’s leading business conglomerates. Its successful
entities include BILT, Crompton Greaves, The Global Green Company, Avantha Power &
Infrastructure, Biltech Building Elements, Salient Business Solutions, and Avantha
Technologies. With an impressive global footprint, Avantha operates in over twenty countries,
employing 20,000 people worldwide. The Group has business interests in diverse areas
including power transmission and distribution equipment and services, paper and pulp, energy
and infrastructure, food processing, farm forestry, chemicals, IT and ITES. Led by Gautam
Thapar, Avantha demonstrates strong leadership globally and emerges as a focused corporate,
leveraging its knowledge, leadership and operations, adding lasting value for its stakeholders
and investors. For more information on Avantha group, please visit www.avanthagroup.com.
About ERGO Insurance Group
ERGO is one of the major insurance groups in Germany and Europe. Worldwide, the Group is
represented in over 30 countries and concentrates on Europe and Asia. ERGO offers a
comprehensive spectrum of insurance, provision and services. In its home market of Germany,
ERGO ranks among the leading providers across all segments. 50,000 people work for the
Group, either as salaried employees or as full-time self-employed sales representatives. In
2011, ERGO recorded a premium income of 20 billion euros and paid out benefits to customers
amounting to 17.5 billion euros. ERGO is part of Munich Re Group, one of the world’s leading
reinsurers and risk carriers.
More at www.ergo.com
Disclaimer
This press release contains forward-looking statements that are based on current assumptions
and forecasts of the management of ERGO Insurance Group. Known and unknown risks,
uncertainties and other factors could lead to material differences between the forward-looking
statements given here and the actual development, in particular the results, financial situation
and performance of our Company. The Company assumes no liability to update these forwardlooking
statements or to conform them to future events or developments.