India: Sachin Bansal to acquire Kishore Biyani’s Future Generali Life Insurance

Sachin Bansal

Flipkart co-founder Sachin Bansal-led Navi Technologies Pvt. Ltd is in advanced discussion to buy out Kishore Biyani’s Future Group’s life insurance JV arm Future Generali India Life Insurance Co. Ltd. in a deal valuing the insurance firm at 1,400-1,500 crore, said two people aware of the ongoing acquisition talks.

Future Generali Life is a three-way joint venture, in which Future Group holds a total of 57.62%, Industrial Investment Trust Ltd. holds 16.88% and Generali holds 25.5%.

“The deal has reached a formal proposal stage and will be announced soon as both parties are keenly interested in the transaction,” said the first person, adding that the embedded value of Future Generali Life is at around 800 crore and a multiple of 1.5-2 times the embedded value is a decent valuation for the company as per the industry standards.

Investment bank UBS is advising Future Group on the deal. “UBS doesn’t wish to comment on any such market speculation,” said a UBS spokesperson.

Spokespersons from Navi, Generali and Future Group declined to comment on the story. An email sent to Industrial Investment Trust did not elicit a response.

On Saturday, Future Group sold its key businesses including retail, wholesale, logistics and warehousing to RIL’s subsidiary Reliance Retail Ventures Ltd. for 24,713 crore on slump sale basis. After the transaction, Future Enterprises Ltd will retain the manufacturing and distribution of FMCG goods and integrated fashion sourcing and manufacturing business and its insurance JVs with Generali and JVs with NTC Mills.

However, for the April-June period of this fiscal Future Generali Life’s new business premium stood at 65.66 crore, which is 56% lower than the 149.26 crore the insurer earned during the same period of last year.

The lockdown induced by the covid-19 pandemic has hit life insurers hard, especially those largely dependent on the agency channel rather than bancassurance channel. According to the Insurance Regulatory and Development Authority of India, during the June quarter the total new business premium of private life insurers saw a 19.2% fall year-on-year at 12,805.42 crore.

After acquiring the general insurance business from DHFL this March quarter, Bansal is planning to add more insurance firms into his second entrepreneurial venture Navi Technologies.

Last year, Navi had acquired the mutual fund business of Essel Group.

Bansal marked his entry into the financial services sector by acquiring Chaitanya Rural Intermediation Development Services, an NBFC, in September 2019.

Bansal, after selling his stake in Flipkart for $800 million in 2018, has allocated a large sum into Navi Technologies (formerly BAC Acquisitions). After infusing 888 crore in November, Bansal, in March, led a round of 3,007 crore in Navi Technologies— along with participation from others.

This article was first published on livemint.com.

Singapore Reporter/s

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Following vacancies can be applied for (only in Singapore).   

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.