Bajaj Finserv is to investigate listing its insurance businesses after paying Rs 24,180 crore to acquire Allianz’s 26 percent share in Bajaj Allianz General Insurance and Bajaj Allianz Life Insurance.
There is a regulatory push for the IPO of larger insurance companies, according to Sanjiv Bajaj, chairman and managing director of Bajaj Finserv. After receiving regulatory clearances, executing the interest transfer, and rebranding, the boards of the general and life insurance companies will determine whether to list.
The boards of both companies are carefully considering the IPO option, and Bajaj estimates that this process will take one to two years. “Bajaj and Allianz want to close this deal as soon as possible,” he stated.
The Bajaj Group has made significant financial commitments to the insurance businesses and is funding the 26% acquisition. This group consists of Bajaj Finserv, Bajaj Holding, and Jamnalal & Sons.
On Tuesday, the BSE saw a 1.33% drop in Bajaj Finserv’s shares to Rs 1,845 and a 0.17% drop in Bajaj Holdings to Rs 11,570.
There would be no changes in leadership for the life and general insurance companies, according to Bajaj, who stated that the professional management team and empowered board will continue to oversee them. He assured staff members during a virtual town hall that the company’s business and operations would not be impacted.
Allianz will no longer be bound by the non-compete agreement after the takeover, allowing it to pursue its goals in the Indian market. According to reports, Allianz intends to work with Jio Financials in the financial services industry.
According to Bajaj, it is difficult to grow the insurance industry in India since most businesses stay small and are unable to raise enough money, which compromises expansion plans.
