HDFC Bank to pick 10% stake in Go Digit Life Insurance

India’s largest private lender today announced that it will invest between Rs 49.9 crore to Rs 69.9 crore to pick up nearly 10 per cent stake in Go Digit Life Insurance, owned by promoters of IPO-bound Go Digit General Insurance.

“This is to inform you that HDFC Bank Limited on August 24, 2022 has entered into an indicative and non-binding term sheet with Go Digit Life Insurance Limited which summarizes the principal terms of a proposed investment, by HDFC Bank in the company, of an amount between Rs 49.9 crore to Rs 69.9 crore, in two tranches, by subscribing to equity shares of the company, for an equity stake of up to 9.944 per cent of the paid-up equity share capital of the Company,” the bank said in an exchange filing.

It said that the transaction is subject to execution of definitive agreement whose terms and conditions are to be mutually agreed upon, and fulfillment of other terms and conditions.

Backed by Prem Watsa-led Fairfax Group and Kamesh Goyal, who are also promoters of Go Digit General Insurance, the company has applied for a licence from the Insurance Regulatory and Development Authority of India (IRDAI) to set up a life insurance business.

Go Digit had recently filed its DRHP to raise up to Rs 1,250 crore via a fresh issue and offer 109,445,561 shares in the offer for sale.

The insurance company has grown at a CAGR of 52.9 per cent