Realty company DLF has divested its 74% stake in the life insurance joint venture (JV) DLF Pramerica Life Insurance (DPLI) to Dewan Housing Finance Corporation Limited (DHFL) and Prudential Financial Inc (PFI), following regulatory approvals.

The move forms part of the company’s strategy to divest non-core operations.

Under the terms of the transaction, DHFL, along with its promoters’ entities, has acquired DLF’s 74% stake in DPLI, in a transaction valued in between INR2.5bn-INR3bn ($40m-$48m), media sources reported.

As per the National Housing Bank (NHB) requirements, DHFL has capped its stake at 50%, while the two other promoter entities have acquired a 12% stake each.

Subject to regulatory approval, the life insurance company will be rebranded to DHFL Pramerica Life Insurance Company (DHFL Pramerica).

Apart from the managing director, the board of the JV company shall comprise three directors from DHFL, two from PFI and two independent directors.

The acquisition will enable DHFL to offer life insurance products to customers in India, while generating significant long-term value for its shareholders.

DHFL chairman and managing director Kapil Wadhawan said together, they can help broaden the company’s ability to meet the life insurance needs of consumers across India.

"We are committed to working with PFI and the team at the joint venture company to grow the business, which we believe will generate long-term value for DHFL shareholders," Wadhawan added.

DLF Pramerica Life Insurance has now become a JV between DHFL and Prudential International Insurance Holdings (PIIH), a wholly owned subsidiary of PFI, a financial services company headquartered in the US.