Hero FinCorp, the retail lending division of motorcycle maker Hero MotoCorp, is reportedly engaged in negotiations to purchase Reliance General Insurance (RGI) from Reliance Capital.

The deal is expected to be valued at approximately INR55bn-60bn ($786m-858m).

Through the deal, Anil Ambani-led Reliance Capital aims to shore up capital to cut its INR180bn ($2.57bn) debt, The Economic Times reported.

By divesting general insurance and mutual fund businesses, Reliance Capital aims to curtail its debt pile to INR90bn.

Earlier, Reliance Capital planned to offload just 49% stake in the general insurance business; however, it is now contemplating total disposal of the business.

The due diligence process has been initiated, one of the sources familiar with the development told the publication.

Through the acquisition of RGI, Hero seeks to tap growth opportunities in financial services sector, particularly in general insurance sector, which has grown at a rate of 16-17% over the last ten years in India.

Earlier, Hero tried to team up with Ergo for a life insurance company licence.

In 2018, Hero Enterprise launched its insurance broking business, through which it offers sell life and general insurance products to its manufacturing and automobile segment.