MUMBAI: Axis Bank has entered into an agreement with Max Financial Services to pursue a listing of their life insurance joint venture, Axis Max Life Insurance, by April 2027, potentially through a merger of Max Financial into the insurer. The agreement outlines a sequence of options to unlock value from the insurance business, with the first step being an attempt to list the company on stock exchanges without a traditional initial public offering.If this route does not materialise, the arrangement provides several alternatives. Axis entities can swap part or all of their shares in the insurer for shares or other non-cash consideration based on a pre-agreed formula. If the listing still does not take place, Axis can require the company to pursue a conventional IPO. The agreement also provides exit mechanisms under which Axis can trigger a sale of its entire stake to Max Financial at fair value if agreed timelines are not met. If Max Financial is unable to buy shares, it must find another buyer at same valuation, failing which Axis can sell its stake to a third party or push for a fresh IPO of insurer.The arrangement also grants governance rights to Axis entities and Mitsui Sumitomo Insurance, another shareholder in the venture. These include the right to nominate directors to the board depending on their shareholding, first rights to subscribe to new shares if the company raises capital, and the ability to block major changes in the capital structure without their consent.The Union Budget for 2025-26 opened the door for the merger of Axis Max Life Insurance, an insurer, with Max Financial Services, its non-insurance holding company, by announcing regulatory changes that allow such structures. Axis group entities hold about 20% in the life insurer. In 2017, HDFC Life had called off a planned merger with Max Life that was intended to secure a listing through a three-way merger involving Max Financial, after regulators said a non-insurance company could not be part of the transaction.Meanwhile, Max Financial informed stock exchanges that its board will meet on March 12 to consider raising capital to meet the funding needs of its subsidiary Axis Max Life Insurance.