General Insurance Corp files for IPO, may raise over $1 billion

It is a part of government’s efforts to list five non-life insurance companies in which it currently holds majority stakes

State-owned reinsurer General Insurance Corp of India on Monday filed for an initial public offering with a plan to raise more than $1 billion, as part of the government's plans to list five non-life insurers in which it holds stakes.

The offer involves an offer for sale of 107.5 million shares by the government, the promoter of the company, along with a fresh issue of 17.2 million shares by the company, according to the draft prospectus.

The offer would comprise around 14.22 per cent of the post-offer paid-up equity share capital. The face value of shares is 5 rupees apiece.

The prospectus said that not more than 50 per cent of the offer will be available for allocation on a proportionate basis to qualified institutional buyers, with 5 per cent of this limit available only for mutual funds. Non-institutional investors will get at least 15 per cent, while retail individual bidders will be eligible to buy at least 35 per cent of the offer, the company said.

The government was looking to offload about 10 per cent stake in General Insurance Corp of India through an initial public offering of around 90 billion rupees in September-October.

On July 28, Life Insurance Corp of India Chairman V.K. Sharma had said that it was keen to invest in the public issue of reinsurer General Insurance Corp of India. General Insurance Corp's public offering will be the first by a stateowned general insurance company in the country, after

the Cabinet Committee on Economic Affairs earlier this year gave its approval to allow five non-life insurance companies to be listed. Kotak Mahindra Capital Co Ltd, Axis Capital Ltd, Deutsche Equities India Pvt Ltd, HSBC Securities and Capital Markets (India) Pvt Ltd, and Citigroup Global Markets India Pvt Ltd are the book running lead managers.