Housing Development Finance Corp, has picked banks to arrange an initial public offering (IPO) of its life insurance joint venture that could raise as much as $400 million (around Rs 2,660 crore), people with knowledge of the matter said.
Citigroup Inc, JPMorgan Chase & Co, Morgan Stanley and Kotak Mahindra Bank are among banks chosen to work on a listing of HDFC Standard Life Insurance Co, according to the people, who asked not to be identified as the information is private. The offering could take place later this year, the people said.
HDFC Standard Life may compete for investors with ICICI Prudential Life Insurance Co, the joint venture between India's biggest private-sector lender and the UK's Prudential Plc that is also preparing an IPO. The deals will be the first listings from India's $50 billion life-insurance industry, which was first opened to private investors 16 years ago.
A representative for HDFC Standard Life didn't immediately respond to an e-mail and phone call seeking comment. IFR reported the bank selections earlier Thursday, citing unidentified people. HDFC Standard Life's board approved plans for an IPO, according to an April 20 statement. Mumbai-based HDFC may sell as much as a 10 per cent stake in the joint venture, while Standard Life will hold on to its entire stake, the statement shows.
The Indian parliament passed a bill last year allowing foreigners to own as much as 49 per cent in the nation's insurers, up from 26 per cent. Indian insurers have drawn at least Rs 9,100 crore in overseas investment since the ownership cap was raised, according to Bloomberg Intelligence.
HDFC last year sold a 0.95 per cent stake in the insurance unit to PremjiInvest, a fund set up by Indian outsourcing billionaire Azim Premji, in a deal that valued the insurer at about Rs 20,950 crore, data compiled by Bloomberg show. Edinburgh-based Standard Life boosted its stake in the Indian venture to 35 per cent, from 26 per cent, in a deal completed in April.
