True North is selling the 20% stake for a consideration of around ₹2,700 crore, the PE firm said in a statement. The transaction is subject to the Insurance Regulatory and Development Authority of India’s (Irdai) approval.
ET first reported on June 23 that Bupa was looking to pick up as much as 15-20% stake from True North.
The transaction values Niva Bupa at approximately ₹12,600 crore.
Niva Bupa will also raise fresh funds to the tune of ₹800 crore in the coming days from financial investors. However, it did not disclose the names of the investors.
This transaction will mean Bupa becomes Niva Bupa’s majority shareholder, with its shareholding set to increase to approximately 63%. Foreign entities are permitted to own up to 74% in Indian insurance companies.
Post completion of both legs of the transaction, stake sale to Bupa and to financial investors, True North will hold around 28% stake in the insurer, financial investors will hold around 7% and the remaining stake will be held by employees.
Bupa, an international healthcare company headquartered in the UK, was a founding shareholder when the business was first established in India in 2008. True North became Niva Bupa’s majority shareholder in 2019 after acquiring a 51% stake held by Analjit Singh’s Max India for ₹511 crore.