The board of Aditya Birla Capital Limited and the unit Aditya Birla Health Insurance Company Limited on Friday approved the investment of 665 crore in the health insurer by the Abu Dhabi Investment Authority (ADIA).
Transaction value was around Aditya Birla Health Insurance 6,650 crore, according to a company statement.
Aditya Birla Health Insurance is a 51:49 joint venture between Aditya Birla Capital and Momentum Metropolitan Strategic Investments (Pty) Limited, a unit of Momentum Metropolitan Holdings Limited of South Africa. The deal is subject to statutory and regulatory approvals including the insurance regulator. and Development Authority of India. Upon completion, ADIA will hold a 9.99% stake, Aditya Birla Capital will hold 45.91% and Momentum Metropolitan Holdings will hold 44.1%.
The money will be used to drive the growth of the health insurer.
“In recent times, health has become a major concern for all. With its distinctive health-first model, Aditya Birla Health Insurance is well positioned to address this concern while protecting health through insurance. ADIA’s investment underscores Aditya Birla Health Insurance’s strong and unique business model and the franchise we have built,” said Vishakha Mulay, Chief Executive Officer, Aditya Birla Capital.
Aditya Birla Health Insurance commenced operations in October 2016. The insurer’s product portfolio includes chronic care and incentive wellness. It has a presence in over 4,800 cities through branches, partner offices, 14 bancassurance partners and over 68,000 direct selling agents.
“We see significant potential in India’s health insurance sector as penetration levels increase, driven by higher awareness and macroeconomic growth. Aditya Birla Health Insurance has a strong management team, a wellness-first product offering and a differentiated distribution model. We look forward to partnering with Aditya Birla Capital and Momentum Metropolitan Holdings to support the next phase of growth for Aditya Birla Health Insurance,” said Hamad Shahwan Al Dhaheri, Executive Director, Private Equity Division at ADIA.
India’s insurance sector has seen several private equity investments over the years, attracted by the growth prospects, given that insurance coverage is among the lowest in the world.
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