SBI Insurance Unit Said to Pick Deutsche, BNP Paribas for IPO

  • Twelve percent stake in the insurer could be offered: filing
  • State Bank and BNP Paribas Cardif to pare stakes in the sale

SBI Life Insurance Company Ltd., the insurance unit of the India’s largest bank, has picked Deutsche Bank AG and BNP Paribas SA as arrangers for its initial public offering, people with knowledge of the matter said.

The insurer, backed by State Bank of India and BNP Paribas Cardif SA, has also chosen Citigroup Inc., Kotak Mahindra Bank Ltd., JM Financial Ltd., Axis Bank Ltd. and ICICI Securities Ltd. to work on the offering, according to the people, who asked not to be identified because the information is private. The sale could take place later this year, the people said.

SBI Life is set to be the second IPO in the insurance sector since India’s parliament cleared a hurdle in 2015 and increased the size of the stake foreign investors can own in the nation’s insurers to 49 percent from 26 percent. State Bank is “exploring the possibility” of selling as much as an 8 percent stake in the Mumbai-based insurer while BNP Paribas Cardif could sell another 4 percent, the lender said in an exchange filing on Friday.

Representative for SBI and SBI Life didn’t immediately respond to calls seeking comments.

State Bank currently holds 70.1 percent of the insurer and Cardif 26 percent, information provided on the company’s website shows. KKR & Co. and Temasek Holdings Pte last year bought 1.95 percent stake each in the company, valuing the insurer at 460 billion rupees ($7.15 billion).

ICICI Prudential Life Insurance Co., the first insurer to go for a share sale, raised about 60.6 billion rupees in September. The South Asian nation has 24 life insurers, 30 non-life insurers and two re-insurers, according to latest data provided by the Insurance Regulatory and Development Authority of India.

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