India-based Edelweiss Financial Services has agreed to divest a minority stake in its wholly-owned subsidiary Edelweiss Insurance Brokers (EIBL) to American brokerage firm Arthur J. Gallagher.

The financial details of the deal have not been disclosed.

EIBL, which started operations in 2005, provides general insurance solutions to institutions and individuals and reinsurance solutions to insurance companies.

The insurance broker is headquartered in India’s financial capital Mumbai. It also has branches in Delhi, Kolkata and Bangalore.

Commenting on the deal, Arthur J. Gallagher chairman, president and CEO J. Patrick Gallagher, Jr. said: “EIBL presents an exciting opportunity to expand Gallagher’s commercial insurance footprint in India, in keeping with our growth strategy to invest in market-leading businesses that broaden our specialist capabilities and diversify our geographic presence.

“We are very pleased to partner with EIBL and broaden our reach in this important market.”

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By GlobalData

Edelweiss Group chairman and CEO Rashesh Shah said: “We are delighted to announce a partnership with yet another marquee global institution like Gallagher that has a similar philosophy, shared values and complementary capabilities.

“This partnership brings to our clients a much broader access to international markets and expertise, and a wider range of insurance products and services, while they continue to receive the same high-quality service.”

The transaction is subject to approval from the Insurance Regulatory and Development Authority of India (IRDIA).

The stake sale part of Edelweiss’ strategy to partner with foreign firm to expand its financial services businesses.

In March, Canadian pension fund CDPQ agreed to invest nearly $250m in ECL Finance, the non-banking financial arm of Edelweiss Group.

In February, it announced that that Allianz Investment Management invested $200m in its private debt platform.