Mumbai: Consumer electronics major Videocon today announced its plans of entering into the financial services business through a general insurance company in partnership with US-based property and casualty insurer Liberty Mutual Group (LMG), reports PTI.
The foreign partner will hold a maximum permissible 26% stake in the joint venture (JV) with Videocon owning the majority. An agreement is expected to be signed between the partners soon.
The partners will be infusing $67 million as the initial capital for the company which will go up till $100 million after five years, by which time they expect to break even by collecting a premium of $300 million.
The JV will primarily focus on personal non-life products like motor, health, homes and small commercial business solutions, LMG's president David H Long told reporters here.
The company will be applying for necessary licenses from the regulator by December and hopes to go operational after September 2011, Mr Long said.
This is LMG's second shot to enter the lucrative Indian insurance sector, Mr Long said, adding the firm's two-year-old tie-up with FMCG major Dabur for general insurance did not progress due to myriad reasons like the global slowdown.
"We have not yet dissolved the agreement, however, it could not work out due to slowdown and time was not right. So we agreed to part ways," Mr Long said, adding de-tariffing is a big booster for entering Indian market now.
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