Sachin Bansal, co-founder of India’s biggest online retailer Flipkart, is in talks with the promoters of Liberty General Insurance Ltd to buy out its insurance business, two people aware of the negotiations said.
Bansal, who exited Flipkart in 2018, plans to merge the acquired insurance business of Liberty with Navi General Insurance Ltd, a unit of Navi Technologies Pvt.
“The plan is to add more insurance and fintech firms under the Navi brand. Valuations are at decent levels and prospects seem good,” one of the two people said on condition of anonymity. The person, however, said the valuation of the potential deal is still to be finalized.
Emailed queries to Navi General did not elicit any response. Bansal did not respond to queries seeking comment.
“As a company policy, Liberty General Insurance does not comment on unsubstantiated market speculation/rumours”, said a Liberty General Insurance spokesperson.
The potential deal between Bansal’s Navi General and Liberty General, as well as the merger of ICICI Lombard and Bharti AXA General, underscores a broader consolidation in the Indian non-life insurance sector.
Liberty General has a balance sheet size of ₹1,734.41 crore.
After acquiring the general insurance business from DHFL earlier this year, Bansal is planning to add more insurance firms into his second entrepreneurial venture Navi Technologies, which aspires to become a full-fledged financial services group by having an array of firms in the insurance, digital banking and fintech space.
Navi Technologies bought DHFL General Insurance in January from Wadhawan Global Capital Ltd.
A potential merger of Navi General with Liberty General will likely create a synergy between the two as Liberty is in need of capital with a solvency ratio at 2.18 against the minimum requirement of 1.5. Navi, on the other hand, needs both the scale of business and penetration in the insurance segment.
