NEW DELHI: The merger of three state-run insurance companies is unlikely to happen anytime soon, with the government preferring to move carefully on the issue, while the department of investment and public asset management (DIPAM) is not averse to take on the task of stake sale in public sector banks, a top official has said.

FM Arun Jaitley in his 2018-19 budget speech had said that the three public sector general insurance companies — National Insurance Company , United India Assurance Company and Oriental India Insurance Company — will be merged into a single entity and subsequently be listed. The plan was part of the overall government strategy for consolidation in the public sector enterprises space.

“Mergers take time and you should take time in mergers anywhere. I am telling you with experience mergers have natural obstacles in

terms of culture and manpower if nothing else. So, once you align the business then you should start aligning the culture and manpower and you have to go to the last man to be able to do so. Mergers are one of the difficult transactions, it calls for skills, which are not available in abundance,” DIPAM secretary Atanu Chakraborty told TOI. “I am not able to put a timeline because I have not reviewed it. I intend to do so,” he said.

DIPAM had asked the department of financial services to get the issue of merger of the three companies examined and prepare a fresh road. There is a view within the government that the issue needs to be thoroughly examined before rushing into a merger.

Chakraborty also did not rule out taking over the task of stake sale in state-run banks within the parameters of the policy now in place. “Last year has not been the best for banks. So, we have not examined that issue in detail.Any disinvestment shakes up the company. We want them to be healthy before we take any decision,” he said.

