Switzerland-based reinsurance company Swiss Re will invest ₹920 crore ($127 million) in Paytm’s general insurance business for a 23% stake on a fully diluted basis, the Noida-based financial services company said on Wednesday.
Swiss Re will invest ₹397.3 crore ($52.9 million) upfront in Paytm Insuretech Pvt. Ltd (PIT) and the remaining in tranches, subject to the fulfilment of certain milestones.
Paytm’s Vijay Shekhar Sharma is also expected to make an investment in the entity. The investment is subject to regulatory approvals.
In June, Mint reported that One97 Communications Ltd, the operator of the Paytm, is set to extend ₹743 crore to entities VSS Holdings and VSS Investco.
Swiss Re’s investment comes more than a year after Paytm entered the general insurance business through the acquisition of Mumbai-based general insurance company Raheja QBE for ₹568 crore. However, the deal is yet to close.
“We are excited to partner with Swiss Re for our insurance foray as a key strategic investor. It is an important milestone in our financial services journey of taking general insurance products to the masses. We look forward to gaining from Swiss Re’s global insurance capabilities and building innovative products to tap into the Indian market,” said Vijay Shekhar Sharma, chairman, managing director and chief executive of One 97 Communications Ltd.
Source: Mint