Singapore’s state investment firm Temasek has emerged as the front-runner to buy a minority stake for $120-130 million (about ₹985-1,070 crore) in health insurance company Niva Bupa Health Insurance, which is majority owned by Indian private equity firm True North, said people aware of the development.
The proposed investment round led by Temasek is likely to value the company at around ₹11,000-12,000 crore ($1.34 -$1.46 billion), the people said. A couple of other investors are likely to join Temasek in this round with smaller cheques, taking the total funding to $180-200 million, they added.
True North had acquired a 51% stake held by Analjit Singh’s Max India in the insurer for ₹511 crore in 2019, then known as Max Bupa Health Insurance, at an enterprise value of ₹1,001 crore. It currently owns a 54.51% stake in the health insurer, while UK’s Bupa holds 44.42% through a Singapore investment vehicle. The remaining stake is held by the company’s employees. True North will be paring its stake in this round primarily of a secondary share sale, the people said. A small part of the investment will be primary, with the proceeds going to the company.
“The company is seeking a round of primary investment to fund its future growth. This will be the last round of private fundraising for the company and Niva Bupa will look to go public after this,” said one of the people. “Given the current market conditions, the IPO plans are likely to take shape in the next year only. With Bupa holding around 45% stake, there is enough headroom to bring in a foreign investor in the current round as well as for a subsequent IPO.”
Niva Bupa had hired Kotak Mahindra Capital to facilitate the investment deal. True North and Niva Bupa declined to comment. “As a matter of policy, Temasek does not comment on market speculation and rumours,” a spokesperson for Temasek said. It recorded gross premiums of ₹2,738.7 crore in the nine-month period ending December 31.
Source: Economic Times