Dewan Housing Finance Corporation Ltd (DHFL) is reportedly planning to divest its 51% stake in unit Pramerica Life Insurance for INR25bn ($331m).

According to the reports, the sale is being planned outside the Insolvency and Bankruptcy Code resolution process.

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DHFL holds the stake in Pramerica Life Insurance through its wholly-owned subsidiary DHFL Investments. This allows lenders to the housing finance company to attempt a sale outside the bankruptcy process.

The sale process is set to begin in a few weeks and the sale proceeds will scale up the housing finance company’s cash holdings, making it a more attractive proposition for bidders, reported Bloomberg.

Pramerica Life Insurance, formerly known as DHFL Pramerica Life Insurance, is a joint venture of DHFL Investments and Prudential Financial’s wholly-owned subsidiary Prudential International Insurance Holdings.

DHFL Investments holds 51% of the stake in the JV, while the rest is owned by Prudential International Insurance Holdings.

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According to public disclosures listed on the insurance company’s website, it has a net profit of INR74.6m for the first quarter of this year. It reportedly collected premium worth INR2.93bn in the January-March quarter.

In 2018, Pramerica Life Insurance signed a bancassurance pact with SVC Co-operative Bank for the distribution of specialised products to the bank’s customers.