Private equity fund True North has sold a part of its holding in India’s largest online insurance aggregator PolicyBazaar to a clutch of five independent buyers – vaccine maker Serum Institute of India (SII), Ashoka India Equity Investment Trust Plc, Triumph Global Holdings Pte, IIFL Special Opportunities Fund Series 8 and India Acorn Fund.
Exact quantum of the diluted stake or valuations were undisclosed in the official announcement.
On February 21, 2021, Moneycontrol had reported that Policybazaar had selected bankers for a mega domestic listing in 2021.
“In October 2020, True North had conducted the first tranche of its stake sale in the company. It continues to be invested in the company for its next phase of growth,” the statement read.
Divya Sehgal, Partner, True North, stated “We’ve had a great partnership with PolicyBazaar over the last three years. We are extremely pleased with the company’s sustained growth momentum and efficiency in delivering great results in spite of the challenging market conditions. We will continue to support PolicyBazaar as it heads towards public markets in the next 12-15 months and scripts many more success stories.”
Yashish Dahiya, CEO, Policybazaar said, “True North has been and continues to be a good friend, advisor and has supported us as an investor through the last few years. We are grateful for that, and glad to see them having a good partial exit, we welcome on board the new shareholders. True North continues to be an investor and we thank them for the confidence.”
To be sure, this is not the first brush of Serum Institute of India with the financial services and insurance space.
On February 10, 2021, Rising Sun Holdings, a company controlled in a personal capacity by SII’s Adar Poonawalla, announced the acquisition of a controlling stake in NBFC Magma Fincorp for around Rs 3,450 crore to create a newly combined entity called Poonawalla Finance.
Post the deal announcement, in an exclusive interview with Moneycontrol, Adar Poonawalla had indicated that “another aspect that attracted us to Magma Fincorp was the fact that they also have a housing finance and insurance business, so it's a full package.”
Founded in 1999, True North is a leading home-grown PE firm with a focus on investing in and transforming mid-sized profitable businesses into large well-established businesses that are valuable, enduring and socially responsible.
It has launched six separate investment funds with a combined corpus of ~$3 billion including co-investments. According to its website, its existing diversified portfolio includes firms like Biocon Biologics, Home First Housing Finance, Fincare, Meru, Zydus Wellness, DM Healthcare & Shree Digvijay Cement
In July 2020, Dahiya had told Bloomberg that the online insurance marketplace plans to go public in India before September 2021 and raise around $500 million via the proposed IPO. The listing was planned at a valuation north of $3.5 billion, the report said.
Policybazaar is housed under Etech Aces Marketing & Consulting which also houses lending marketplace Paisabazaar. Other than True North, it has a long list of enviable list of investors on board, which includes Softbank, Temasek, India’s first dotcom to list on the domestic bourses, Info Edge (which backs Zomato, Naukri.com and 99acres.com), Premji Invest, Tiger Global, Steadview Capital, Ribbit Capital, Inventus, Chiratae Ventures and Wellington Management.
Policybazaar’s listing plans come on the back of a sharp spike in the demand for online health and life insurance products post the outbreak of COVID-19. It offers products in segments ranging from life insurance (it claims to account for 25 percent of India’s life cover), investment plans, health insurance, motor insurance, general insurance, travel insurance and others. The leading fintech player now serves over 8 million insurance buyers annually and hosts 40+ insurers on its platform.