Bupa looks to raise stake in health joint venture

UK-based healthcare providers and insurance coverage supplier Bupa is in talks with home non-public fairness agency True North to choose part of the PE agency’s stake in Niva Bupa Well being Insurance coverage Co, a three way partnership between the 2, sources conscious of the event advised ET.

Bupa is more likely to choose up as a lot as 15-20% stake from True North, at a valuation of ₹11,000-12,000 crore, the sources stated.

Bupa at present holds a 44.42% stake within the well being insurer. Indian insurance coverage sector rules allow overseas traders to carry as much as 74% stake in an insurance coverage firm.

True North, acquired a 51% stake held by Analjit Singh’s Max India within the insurer for ₹511 crore in 2019, then often called Max Bupa Well being Insurance coverage, for an enterprise valuation of ₹1,001 crore. True North at present owns a 54.51% stake within the well being insurer. Remainder of the shareholding is owned by staff.

The talks between Bupa and True North are working parallel to the talks with Temasek, which is trying to make investments round $120-130 million within the insurer, as reported by ET on Might 4. Temasek is in talks to choose up some stake from True North whereas additionally investing some contemporary capital into the insurance coverage firm.

True North declined to remark. A Bupa Group spokesperson stated: “Whereas we’re unable to touch upon hypothesis, we stay totally dedicated to our profitable and fast-growing enterprise in India.”

The corporate recorded gross written premiums of ₹4,073 crore on the finish of the monetary 12 months 2022-23, registering development of 45% over final fiscal’s gross written premium of ₹2,809 crore, as per its newest annual report.

Claims incurred by the corporate stood at ₹1,439 crore for the interval ending December 31, growing from ₹1,088 crore within the earlier 12 months.

Niva Bupa’s solvency ratio dropped to 1.67 occasions as of March 31, 2023, from 1.72 occasions within the earlier 12 months. IRDAI mandates a minimal solvency ratio of 1.5 occasions. Solvency ratio is an indicator of an insurance coverage agency’s monetary stability and its potential to pay claims.

Niva Bupa reported a revenue of ₹12.5 crore in fiscal 2023, as in comparison with a lack of ₹196.5 crore within the earlier fiscal.

As per a January 4 credit standing report by Care Scores, the promoters of the corporate have been supporting the corporate’s development with common funding and have invested ₹695 crore within the final three fiscals.