Share of Edelweiss Financial Services after the company decided to offload its 70 percent stake in the insurance broking joint venture. Edelweiss Financial stock opened with a gain of 2.5% at Rs 73.90 on BSE. The stock touched an intraday high of Rs 75.4, rising 4.58% on BSE.
Edelweiss Financial stock is trading higher than 5 day, 20 day, 50 day, 100 day and 200 day moving averages.
The share has gained 22.54% in one year and risen 8.24% since the beginning of this year.
In a month, the stock has risen 15.13%.
Market cap of the firm rose to Rs 6,949 crore.
Later, the stock ended 2.91% higher at Rs 74.20 against previous close of Rs 72.10 on BSE.
Total 3.53 lakh shares changed hands amounting to turnover of Rs 2.62 crore.
The financial services firm said it would exit the insurance broking business by selling its 70 percent stake in Edelweiss Gallagher Insurance Brokers for Rs 307.60 crore.
“The company has entered into an agreement… to divest its entire shareholding (currently 70 percent) in Edelweiss Gallagher Insurance Brokers Ltd, a subsidiary, engaged in the business of insurance broking to Arthur J Gallagher & Co…,” said Edelweiss Financial Services.
Gallagher, who previously held 30 percent in the business, will now be acquiring all the remaining shares, taking its stake to 100 percent.
The company said, as per the agreement 37,00,000 equity shares of Rs 10 each representing 70 percent of the paid up share capital of Edelweiss Gallagher Insurance Brokers held by the company to be sold for a consideration of Rs 307.60 crore, in one or more tranches, in the manner as set out in the agreement.
Rashesh Shah, Chairman, Edelweiss Group said the sale will provide the company “with the flexibility to reallocate capital and invest in scaling up our fast-growing life and non-life insurance businesses, making this a win-win for both of us.”
The transaction is subject to receipt of regulatory and other appropriate approvals (including approval of the Insurance Regulatory and Development Authority of India) and fulfilment of the obligations/conditions prescribed in the agreement.