Religare Enterprises Limited (REL) (NSE: RELIGARE, BSE: 532915), today announced that the company has entered into a binding agreement with Kedaara group entity, Trishikhar Ventures LLP, a leading private equity investment firm for investments in its health insurance subsidiary – Religare Health Insurance Company Limited (“RHICL”). The company currently holds 88.951 % equity share capital in RHICL.
The total deal value is pegged at Rs. 400 cr of which, Rs. 200 cr would be for the stake sale by REL while another Rs. 200 cr would be brought in as primary equity capital by Kedaara. The investor will also have the option of investing another Rs. 100 cr. Post consummation of this transaction, REL will hold 76.18% stake in RHICL.
This deal will support the growth of the health insurance business and will enable REL to become debt free after the completion of this transaction and the divestment of its lending business to the TCG Group. This will in turn, help the company to emerge as a strong financial services company.
Dr. Rashmi Saluja, Non-Executive Chairperson of Religare Enterprises Limited said – “We are glad to partner with Kedaara for this transaction. REL has been going through difficult times in the recent past and the new management has been taking important steps to not only strengthen corporate governance practices and compliances, but also capitalise the businesses for future growth. We are confident that this transaction will strengthen our position in the financial services business and will help us to achieve our aim of becoming a debt free company by June 2020. Our health insurance business is well capitalised to grow its market share and is poised to achieve a market leader position soon.”
Commenting on the transaction, Mr. Anuj Gulati, MD & CEO, Religare Health Insurance, said – “This transaction will enable us to increase our investment in technology, distribution and service capability. I would like to convey my sincerest appreciation to our current shareholders, board of directors, customers, distribution partners and employees for reposing their faith in us over the years. I also warmly welcome our incoming shareholders and thank them for the belief that they have vested in us. We remain committed to building an institution that will be relevant beyond a 100 years.”
Since RHICL is an IRDAI regulated entity, the transaction will be subject to IRDAI approval and other regulatory and statutory approvals as applicable and fulfillment of other conditions precedent. The transaction is expected to be completed within the financial year 2020-21.
Shares of RELIGARE ENTERPRISES LTD. was last trading in BSE at Rs.45.05 as compared to the previous close of Rs. 42.95. The total number of shares traded during the day was 81408 in over 393 trades.
The stock hit an intraday high of Rs. 45.05 and intraday low of 42.3. The net turnover during the day was Rs. 3616784.