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Last Updated : Jun 24, 2019 12:49 PM IST | Source: Moneycontrol.com

PE investors line up to buy SBI General foreign partner's stake ahead of IPO

SBI is planning an IPO for SBI General Insurance in FY20

Moneycontrol News @moneycontrolcom

Multiple private equity (PE) funds are in the race to acquire Insurance Australia Group (IAG)'s 26 percent stake in SBI General Insurance.

An Economic Times report said that Carlyle, ChrysCapital, PremjiInvest, and GIC of Singapore are in the race for the stake.

The size of the deal would be Rs 3,000 crore valuing the non-life insurance company at Rs 12,000 crore.

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SBI General is planning an initial public offering (IPO) in the Indian stock markets in FY20. A deal to sell IAG's stake will help in price discovery.

SBI General Insurance is a joint venture between IAG and State Bank of India. SBI holds 70 percent in the venture while IAG holds 26 percent.

In September 2018, SBI had approved a 4 percent stake sale in SBI General Insurance to Axis New Opportunities Fund (Axis AMC) and PI Opportunities (Premji) for Rs 481.73 crore. Prior to this deal, SBI held 74 percent in the general insurer.

IAG had expressed intent earlier this year to sell its stake in the general insurance company.

The insurance regulator has allowed PEs to become promoters of insurance companies. However, it has mandated the firms to stay invested for a minimum of five years. Further, PEs also have to set up a special purpose vehicle (SPV) for such investments in the insurance sector.

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First Published on Jun 24, 2019 12:49 pm
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