Bajaj Cap Looks to Sell 49%; Global Insurers, PEs Evince Interest

Co, which is looking at a valuation of Rs. 1,200 crore, hires Avendus Capital to scout for buyers; former MD of PNB MetLife too keen on buying stake

Bajaj Capital, a Delhi based investment services company, is looking to sell 49% of its stake, and has mandated Avendus Capital to scout for buyers. Some global insurance companies and private equity investors have shown interest in Bajaj Capital which is valued . 1,200 crore.at about ` “Bajaj Capital has hired Avendus Capital to look for buyers for its 49% stake,“ said two persons in the know of things. “The company is looking at a valuation of close to . 1,200 crore.“

` The Insurance Amendment Act has brought insurance intermediaries under the same FDI ambit as insurance companies. The Act allows foreign direct investment of up to 49% in insurance companies and intermediaries.

Many private equity investors, including global insurance companies, have expressed interest in buying stake in the company. Rajesh Relan, former managing director of PNB MetLife, is also in talks to acquire stake in the company. “It is a live mandate for me, so I cannot divulge any further information,“ said an Avendus Capital executive. Bajaj Capital said it does not want to comment on the story.

The stake is being sold in the group company which has other ventures like Bajaj Capital Insurance Broking, an IRDA-licensed Composite Insurance Broker; Just Trade Securities Limited, member of NSE and BSE; and Bajaj Capital Investment Centre Limited, which facilitates realty solutions. The company serves over 10 lakh customers and has over 120 offices spread across 70 cities in India.

The government raised foreign direct investment limit in insurance o 49% from 26% after debating over t for six years.

The industry has been waiting for higher FDI in insurance to grow and increase penetration. Foreign promoters have increased stake post amendment in almost seven companies, including life and general insurance. After the limits were raised, Canadian firm Fairfax had raised stake in IIFL Holding Company which has interest in insurance distribution.

Source: Economic Times

Date: 8th January 2016

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