Reliance General Insurance, a wholly-owned subsidiary of Anil Ambani-led Reliance Group, has received the green light from the Securities and Exchange Board of India (SEBI) to float an initial public offering.
The IPO comprises a fresh issue of over 16.7 million shares by Reliance General Insurance besides an offer for sale of 50.3 million shares by Reliance Capital, the insurer said in a statement. The fresh issue will constitute up to 25% of the post-issue paid-up capital of the insurer.
The company plans to utilise the proceeds from the fresh issue towards augmenting the solvency margin and meeting future capital requirements, which are expected to arise out of growth.
Reliance General Insurance had filed draft papers with SEBI for an IPO in October. It had received in-principle approval from the IRDAI in September for the IPO.
At the end of March this year, Reliance General Insurance’s book value stood at INR12.5 billion (US$194 million). The company’s valuation is expected to exceed INR60 billion.