American investment firm Carlyle Group has purchased a 9% stake in India-based SBI Life Insurance Company from BNP Paribas Cardif in a transaction valued at around INR55bn ($776.22m).
Carlyle Group executed the SBI Life deal through CA Emerald Investments, an affiliated entity of Carlyle Asia Partners V that focuses on acquisition and investments in various sectors in Asia Pacific region.
After completion of the deal, BNP Paribas Cardif and CA Emerald Investments hold 12.8% and 9% of the SBI Life, respectively. With a 62.1% stake, State Bank of India (SBI) remains the majority shareholder in the life insurance firm, which is the subsidiary of State Bank of India.
SBI managing director of global banking and subsidiaries Dinesh Kumar Khara said: “We are pleased with the tremendous strides made by SBI Life in establishing its position in the life insurance industry and appreciate the support given by BNP Paribas Cardif in this journey.
“We are also thrilled to welcome Carlyle, with whom we have an existing relationship through SBI Card, and look forward to its support to SBI Life in bolstering its franchise in the country.”
Carlyle Asia managing director of the buyout advisory team Sunil Kaul said: “The life insurance industry in India has strong growth potential thanks to favourable demographics and an increasing focus on financial savings.
“SBI Life, led by a strong management team, is helping deliver this promise in the life insurance space and is well-positioned to further benefit from industry trends. We are excited about the company’s growth prospects and proud to have this opportunity to support the journey.”
Recently, Carlyle invested in PNB Housing Finance and SBI Card in India.
In the financial services industry of Asia Pacific region, Carlyle has invested over $4bn of equity in over 15 private equity investments as of 31 December 2018, during the last two decades.
In August 2018, the last major deal in life insurance sector was an agreement to acquire Star Health and Allied Insurance by a consortium of Westbridge Capital, Madison Capital and Rakesh Jhunjhunwala for around Rs60bn ($846.35m) – Rs65bn ($916.88m), reported Live Mint.