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Safecrop Holdings Pvt Ltd, a consortium comprising WestBridge AIF, Rakesh Jhunjhunwala and Madison Capital, is to acquire standalone private health insurer Star Health and Allied Insurance.
The consortium has signed a definitive agreement with the shareholders of Star Health to purchase their shares in the company, said a statement. Though the transaction value was not disclosed, the deal was reported to be valued at close to $1 billion.
When BusinessLine reached out to V Jagannathan, Star Health’s CMD, he declined to reveal the transaction value and other financial details.
Existing shareholders of Star Health include Star Health Investments and funds managed or advised by ICICI Venture, Tata Capital and Apis Partners. The transaction is subject to regulatory and certain other approvals.
Chennai-headquartered Star Health, founded in 2006, is India’s first — and currently the largest — standalone health venture. As of March 31, 2018, it had a marketshare of about 11 per cent in health insurance. The company has a network of 434 offices, about 2.4 lakh agents and tie-ups with around 8,500 hospitals.
It employs about 11,000 people and has provided insurance coverage to about 1 crore people, said the statement.
The company had written direct premium of ₹4,161 crore with profit after tax of ₹171 crore and networth of ₹960 crore as of March 31, 2018. For Q1 of this fiscal, it had garnered gross direct premium of ₹910 crore, up 35 per cent over the same period in the previous year.
“From humble beginnings, we have come to this level with excellent teamwork. We feel that new investors, with their abundant experience and golden touch, will enable the company to scale further heights,” said Jagannthan.
Sumir Chadha, co-founder and MD of WestBridge Capital, said Star Health will continue to grow at a healthy pace in the coming decade, driven by increasing penetration.
“We are highly confident of Star’s business model and believe that Star will continue to lead the retail health insurance space,” he said.
“I believe health insurance is a key tool for every citizen towards financial stability. I believe Star Health is best equipped to serve the country’s health insurance needs,” said Jhunjhunwala.
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