MC EXCLUSIVE Warburg Pincus eyeing exit from IndiaFirst Life Insurance post 2018 bet

Back in June 2018, Warburg Pincus purchased the stake held by UK’s Legal & General for an undisclosed amount and entered IndiaFirst Life Insurance.

Eight years after betting on private life insurer IndiaFirst Life Insurance, US private equity giant Warburg Pincus is in exit mode and has engaged an advisor to find a buyer for its 26 per cent stake, multiple industry sources in the know told Moneycontrol.

Mumbai headquartered IndiaFirst Life Insurance is a 3-way joint venture between lead shareholder Bank of Baroda which holds 65 percent, Union Bank of India which holds 9 percent and Carmel Point Investments India Pvt Ltd (an affiliate of the Warburg Pincus group) which holds the balance stake.

“Warburg Pincus has been invested with the firm for many years and has now got investment bank Barclays on board as the sell-side advisor. Preliminary conversations have begun with suitors though the deal is likely to be launched later this month or next month based on market conditions,” said one of the persons above.

A second person confirmed the above and added, “Warburg Pincus has timed their exits well in the past and feels this is the right window to explore the same in IndiaFirst Life Insurance.”

According to a third person, “The preferred outcome would be for them to divest to a private equity player. If that doesn’t work out, then the IPO option, which was attempted earlier, can be considered at a later stage depending on the strategy of all stakeholders.”

All the three persons above spoke to Moneycontrol on the condition of anonymity.

In response to an email query from Moneycontrol, Warburg Pincus declined to comment. Queries mailed to IndiaFirst Life Insurance, Bank of Baroda and Barclays were left unanswered at the time of publishing this article. Reminders have been sent and this article will be updated as soon as we hear from these firms.

Back in June 2018, Warburg Pincus purchased the stake held by UK’s Legal & General for an undisclosed amount and entered IndiaFirst Life Insurance. A PTI report later pegged the stake purchase value at Rs 710 crore.

In the past, private equity firms like True North, Premji Invest, Kedaara Capital, Westbridge Capital, Madison Capital and ICICI Ventures have bet on the domestic insurance segment.

Warburg Pincus: The India financial services playbook

Incidentally, this is the third consecutive transaction in the domestic financial services space involving the global investment major in recent months. The proposed IndiaFirst Life Insurance deal comes at a time when Warburg Pincus is reportedly in talks to sell its 10 percent stake in SBI General Insurance to SBI and Premji Invest. Last month, it exited portfolio firm Home First Finance in a block trade.

On August 11, Moneycontrol had reported that Warburg Pincus was eyeing a $143 million clean out trade in Home First Finance.

Last year in May, top Chennai-based retail NBFC Shriram Finance announced the sale of its subsidiary Shriram Housing Finance to Warburg Pincus for Rs 4,630 crore.

On December 14, Moneycontrol was the first to report that the listed parent had revived stake sale plans to unlock value in its housing finance arm.

Post the transaction, Narendra Ostawal , MD, Warburg Pincus told Moneycontrol in an interview “We have enormous experience of taking over NBFC's and scaling them in partnership with management teams, so for us, it's Deja Vu! We did this in Capital First and we did this in Avanse Financial Services, Vistaar Finance, so ditto!”

The PE firm has paused its IPO plans for education loans financier Avaanse Financial Services due to stricter US visa rules, according to a recent report by Bloomberg.

A closer look at IndiaFirst Life Insurance

IndiaFirst Life Insurance had filed draft papers with Sebi for an IPO in October 2022 and received the regulators nod in March 2023. But the plans did not proceed.

Talking about the firm’s listing plans, the MD and CEO Rushabh Gandhi told Business Standard last month, “The IPO was never shelved. It was deferred and that is precisely what the status is as of now. While the last 2 quarters have been encouraging, maintaining consistent growth over the next few quarters will be important. In addition to a stable growth path, limited headwinds, and increased tailwinds, along with supportive market conditions, are necessary for the IPO to be successful. The timing will ultimately be determined by our shareholders.”

As on 31 March 2025, the firm’s new business individual retail premium stood at Rs 1,425 crores & total premium stood at Rs 7,218 crores. As per its website, it services over 16 million customers, has a workforce of ~4,600 and a network of ~22,000 partner branches along with ~115 third party distributors & corporate agents. The firm also has a network of ~1,880 agents which completes its distribution ecosystem, the website says.

Also Read: Barclays injects Rs 2,300 crore into India operations to fuel growth

FAQs

What is the origin of the name “ Warburg Pincus”?

“Warburg” is associated with the prominent European banking family, while “ Pincus” comes from Lionel Pincus who merged with the former in 1966

What are some of the recent prominent deals in the insurance sector?

Bajaj Finserv acquired Allianz SE’s entire 26 per cent stake in Bajaj Allianz General Insurance and Bajaj Allianz Life Insurance ending a 24-year-old relationship. Secondly, UK’s Prudential Plc announced a health insurance JV with the HCL Group