Bankrupt consumer electronics maker Videocon Industries Ltd said on Wednesday it will sell its entire 51.32% stake in its insurance unit to a DP Jindal Group company and financial services firm Enam Securities Pvt. Ltd.
The Insurance Regulatory and Development Authority of India has approved the stake sale in Liberty Videocon General Insurance Co. Ltd, Videocon said in a stock-exchange filing. It didn't disclose the deal value.
The insurer is a joint venture of Videocon and Liberty Citystate Holdings Pte Ltd, a unit of US-based Liberty Mutual Insurance Co.
Diamond Dealtrade Ltd, part of steel pipe maker DP Jindal Group, will hold 26% of Liberty Videocon General while Enam will own 25.32% upon completion of the deal, the filing said. The transaction is subject to “various closing conditionsâ€, it added.
Videocon has been going through tough times. Last month, the State Bank of India, the country's largest lender, initiated insolvency proceedings against Videocon at the National Company Law Tribunal.
The company has also been selling its assets. In November, it agreed to sell its home appliances brand Kenstar to private equity firm Everstone for an undisclosed amount.
In November 2016, Videocon had had agreed to merge its direct-to-home television arm with market leader Dish TV. The merger has now run into rough waters.
Videocon’s revenue from operations for the nine months through December 2017 slumped to Rs 2,778.91 crore from Rs 7,524.35 crore. Its net loss widened to Rs 3,191.51 crore from Rs 1,254.35 crore, according to stock-exchange filings.