BNP Paribas Cardif — the joint venture (JV) partner of SBI Life Insurance — has approached the bank with a letter of intent to raise its stake to 36% in the JV, SBI chairman Arundhati Bhattacharya said on Tuesday.
Bhattacharya said BNP Paribas Cardif is interested in picking up an additional 10% in the JV. She said may be later the bank can look at an initial public offer (IPO).
“They have given a letter and have exercised that call for 10%. We have to come to a valuation on which both of us agree, so that this can be taken forward,” she said, adding the sale will happen in three to four months.
“It will be a sale of equity stake. We will encash upon our stake,” she explained.
SBI owns 74% of the total capital and BNP Paribas Cardif holds 26% stake in SBI Life Insurance — a joint venture between SBI and BNP Paribas Cardif of France. SBI Life Insurance has an authorised capital of Rs 2,000 crore and a paid-up capital of Rs 1,000 crore.
Earlier in March, SBI had received board approval to divest up to 10% stake in SBI Life Insurance. In a regulatory filing, the bank said, “The Executive Committee of the Central Board (ECCB) on March 30 had approved divestment of SBI’s stake in SBI Life Insurance by up to 10%.”