Digit Insurance, a company backed by Canadian billionaire Prem Watsa’s Fairfax Group, has postponed a planned initial public offering (IPO), a regulatory document from the Securities and Exchange Board of India (SEBI) revealed on Tuesday.
The IPO has been “suspended” and certain comments have been made, the document said on SEBI’s website without going further.
Reuters reported last month that Digit Insurance was looking to raise approximately $440 million for its non-life insurance business through an IPO. Sources had said it was looking for a valuation between $4.5 billion and $5 billion.
Fairfax-Backed Digit Insurance Seeks $5 Billion in India IPO Valuation: Sources
While SEBI did not provide reasons for its decision, a source familiar with the watchdog’s thinking said the regulator had expressed concerns that privately-owned Digit issued shares to more than 200 individuals in the past fiscal year, leading to concerns about the fact that the privately held Digit has issued shares to more than 200 individuals. not allowed under Indian law. .
Digit will need to assess SEBI’s concerns and resolve them in an appropriate forum, the source added.
A Digit spokesperson declined to comment and SEBI did not immediately respond to Reuters’ questions.
Founded in 2017, Digit is looking to expand into general insurance and offer customer service benefits, including simpler claims arrangements. Separately, it is entering the life insurance market with its Go Digit Life business.
The prospectus filed by the company last month showed that the IPO will consist of new shares worth 12.5 billion Indian rupees ($158 million), while existing stakeholders will sell up to 109.4 million shares.
(Reporting by Aditya Kalra in Delhi and Abhirup Roy and M. Sriram in Mumbai; editing by Kim Coghill and David Goodman)
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