Punjab National Bank to take 30% stake in MetLife India

MetLife India has a paid-up capital of INR19.9 billion ($452 million), and will issue new shares to PNB that will take its capital to INR25.9 billion. Consequently, the equity of existing shareholders will be diluted. Another dilution will occur if MetLife makes good on its proposal to bring its stake in the company back to 26% through a further share purchase, The Times of India reported.

Once the deal is finalized, the company will be renamed PNG MetLife India.

K.R. Kamath, chairman of PNB, said the commercial terms of the deal would be kept confidential until regulatory approval is granted. William Toppeta, international president of MetLife, said in a statement: "We believe that the addition of an outstanding financial institution like PNB as a shareholder and partner will greatly enhance MetLife India's ability to move into the top tier of life companies here."

PNB is the largest nationalized bank with a network of 5,290 branches. The bank is said to have appointed Boston Consulting Group to advise it on the deal.

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• Goldman Sachs