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Joint venture with UK player starts India’s first insurer IPO

Joint venture with UK player starts India’s first insurer IPO

Joint venture with UK player starts India’s first insurer IPO
The joint venture between India’s largest mortgage lender and UK’s Standard Life Plc has become the first life insurer in the South Asian country to initiate the process for an initial public offering (IPO).
 
Housing Development Finance Corporation (HDFC) said in a regulatory filing that its non-listed subsidiary, HDFC Standard Life Insurance, has approved steps to start the IPO process, The Economic Times reported.
 
The report said the IPO process will see HDFC diluting 10% of its 61.65% stake in HDFC Standard Life Insurance.
 
According to a report by the Asia Asset Management, industry experts estimate the deal at USD$299.67 million, based on valuations derived from the insurer’s past off-market stake sale transactions.
 
The IPO process has kicked off following HDFC’s recent sale of its additional 9% stake in HDFC Standard Life to Edinburgh-based Standard Life, which increased its stake in the venture from 26% to 35%.
 
Standard Life paid USD$255.62 billion to HDFC for the additional 9% stake, the Asia Asset Management reported.
 
The HDFC Standard Life IPO will be the first from an insurer to be on the Indian market since private participation was first allowed by the government in 2000.
 
However, the company might not be the last Indian insurer to initiate the IPO process since up to seven other companies are mulling over the potential listing of their insurance arms, according to Bloomberg.