Life insurance major IndiaFirst Life Insurance Company received final approval from Securities and Exchange Board of India (Sebi) to float an initial public offering to raise funds. The issue will comprise a fresh issue of equity shares worth Rs 500 crore and an offer-for-sale (OFS) up to 14.1 crore equity shares from promoters and stakeholders. The insurance company is owned by two of India’s largest PSU banks, Bank of Baroda and Union Bank of India. Additionally, Carmel Point Investments India, owned by private equity funds managed by Warburg Pincus, bought a stake in the life insurance firm.
In the OFS component of the IPO, Bank of Baroda will offload about 8.9 crore equity shares, while Carmel Point Investments India Private Limited will tender 3.9 crore equity shares and 1.3 crore equity shares will be sold by Union Bank of India. Additionally, the firm may consider a private placement, preferential allotment, rights issue or such other methods which would aggregate up to Rs 100 crore. Based on the success of these mediums, the size of the fresh issue would be reduced or reworked.
The proceeds from the fresh issuance worth Rs 500 crores will be used towards augmentation of its capital base to support solvency levels.
ICICI Securities