Chennai, Jan 19 (IANS) Kolkata-based public sector insurer National Insurance Company Limited has called for a meeting of its Board of Directors on Monday.
The meeting is held after the Board of Directors of two other government-owned general insurers – Oriental Insurance Company Ltd and United India Insurance Company Ltd- were held in Delhi on Friday.
The central government had earlier proposed to merge all the three insurance companies into one entity.
While the leader of a major union in the sector told IANS that the board meetings are being held at short notice to give the green signal for merger of the three companies into one, the top officials of the three companies maintain a studied silence.
The Board meetings of United India and Oriental Insurance were held in Delhi to give their nod for merger. Similarly, the Board of National Insurance will meet on Monday for the same purpose, K.Govindan, General Secretary, General Insurance Employees All India Association (GIEAIA) had told IANS on Friday.
Another industry official also confirmed the development and told IANS on anonymity: “The development comes two weeks before the Union Budget to be placed in the Parliament by Finance Minister Nirmala Sitharaman.”
The official said the Finance Minister may announce infusion of capital for the ailing entities in her upcoming budget.
“There is no need for a merger if the Finance Minister announces infusion of capital for the three individual companies,” the official added.
The Chairman and Managing Director (CMD) of United India Girish Radhakrishnan and the CMD of Oriental Insurance A.V.Girija Kumar were not available for comments despite several attempts by IANS.
On the other hand the CMD of National Insurance Tajinder Mukherjee declined to comment on the matter when contacted by IANS.
Another view is that the Boards of two companies met on Friday and one will meet on Monday to give their nod for raising more debt to meet their solvency norms.