Manulife Financial, Mahindra to form life insurance JV

Mr. Phil Witherington reports MANULIFE AND MAHINDRA AGREE TO ESTABLISH 50:50 LIFE INSURANCE JOINT VENTURE IN INDIA Manulife Financial Corp. and Mahindra & Mahindra Ltd. (M&M) have entered into an agreement to establish a 50:50 life insurance joint venture, subject to regulatory approval. This new venture will strengthen Manulife and Mahindra's existing footprint in India, and underscores their commitment to enhancing the financial well-being of customers in one of the world's fastest-growing markets. The vision is to be the No. 1 life insurance company for rural and semi-urban India, and in serving urban customers through leadership in protection solutions. The joint venture aims to offer long-term savings and protection solutions tailored to the diverse and growing needs of India's population, in line with India's "insurance for all" vision by 2047 (1). Combining Mahindra's deep access and extensive distribution in rural and semi-urban areas with Manulife's proven quality agency capabilities catered to urban customers, the joint venture will create long-term value by driving customer centricity and leveraging new technologies. This joint venture will expand on the strong collaboration between Manulife and Mahindra in India, following the successful launch of Mahindra Manulife Investment Management in 2020. The total capital commitment from each shareholder is up to $400-million (U.S.) (Rs 3,600 crores) and the venture expects each shareholder to invest $140-million (U.S.) (Rs 1,250 crores) in the first five years. India: a compelling growth opportunity underpinned by strong megatrends The life insurance market has surpassed $20-billion (U.S.) in new business premiums, growing at a 12-per-cent CAGR (compound annual growth rate) over the past five years (2). Yet India continues to have a high protection gap and low insurance penetration, providing significant long-term growth potential. These tailwinds position India to become the world's fastest-growing life insurance market over the next decade, on track to become the fourth largest globally (3). This growth is underpinned by robust GDP (gross domestic product) expansion, a rising middle class and a supportive regulatory environment. Manulife & Mahindra: a very strong partnership "Today marks an important milestone as we seek to enter one of the world's fastest-growing insurance markets -- India," said Phil Witherington, president and chief executive officer, Manulife. "This will further strengthen our diverse portfolio and positions us for tremendous growth in a mega economy of the future. We have a trusted partner in Mahindra Group, with whom we already have a successful asset management collaboration, and we see tremendous opportunity to build on our efforts by leveraging their deep distribution network alongside our industry-leading agency distribution and insurance expertise." (1) "Insurance for all" vision by 2047 is an initiative by The Insurance Regulatory and Development Authority of India (IRDAI) to address India's protection gap and enhance coverage for the Indian population. (2) Source: IRDAI. (3) Source: McKinsey & Company. Dr. Anish Shah, group CEO and managing director, Mahindra Group, said: "Mahindra brand strength, deep distribution capabilities in rural and semi-urban India, and execution excellence make life insurance a logical extension towards our goal of building a comprehensive financial services portfolio. Manulife is the best natural partner for us, given their global capabilities in insurance products, underwriting and reinsurance. With a focus on leveraging technology the joint venture will build an efficient, customer-centric insurer in India. We are confident that this joint venture offers a very compelling opportunity to create meaningful value for our shareholders." Following today's signing, the Manulife and Mahindra teams will work together to apply for an insurance licence. Debevoise & Plimpton LLP acted as legal counsel to Manulife. Kotak Investment Banking acted as financial adviser, and AZB & Partners acted as legal counsel to Mahindra Group. About Mahindra & Mahindra Ltd. Founded in 1945, the Mahindra Group is one of the largest and most admired multinational federation of companies with 324,000 employees in over 100 countries. It enjoys a leadership position in farm equipment, utility vehicles, information technology and financial services in India, and is the world's largest tractor company by volume. It has a strong presence in renewable energy, agriculture, logistics, hospitality and real estate. The Mahindra Group has a clear focus on leading ESG (environmental, social and governance) globally, enabling rural prosperity and enhancing urban living, with a goal to drive positive change in the lives of communities and stakeholders to enable them to rise. About Manulife Financial Corp. Manulife is a leading international financial services provider, helping its customers make their decisions easier and lives better. With its global headquarters in Toronto, Canada, Manulife operates as Manulife across Canada, Asia and Europe, and primarily as John Hancock in the United States, providing financial advice and insurance for individuals, groups and businesses. Through Manulife Wealth & Asset Management, the company offers global investment, financial advice and retirement plan services to individuals, institutions and retirement plan members worldwide. At the end of 2024, Manulife had more than 37,000 employees, over 109,000 agents and thousands of distribution partners, serving over 36 million customers. Manulife trades as MFC on the Toronto Stock Exchange, New York Stock Exchange and Philippine Stock Exchange, and under 945 in Hong Kong. We seek Safe Harbor.