Niva Bupa Health in talks of IPO

Rs625 crore of the net proceeds from the fresh issuance to boost the capital base.

Niva Bupa Health Insurance, formerly Max Bupa, eyes to raise funds through an initial public offering (IPO) worth Rs3,000 crore through the Securities and Exchange Board of India (SEBI), as reported by the Economic Times.

It filed a draft red herring prospectus with SEBI this week. The IPO will comprise of fresh issuance of shares valued at Rs800 crore and an offer for sale (OFS) of up to Rs2,200 crore by the promoter and investor-selling shareholders.

Rs320 crore of the OFS will come from Bupa Singapore Holdings, whilst Rs1,880 crore will be by Fettle Tone.

It also indicated a “possibility of a pre-IPO placement” of up to Rs160 crore. The IPO will be done through a book-building process, where a minimum of 75% of the offer goes to Qualified Institutional Buyers (QIBs) on a proportionate basis. Whilst 15% will go to non-institutional bidders and 10% to the retail individual bidders.

Bupa said it plans to use Rs625 crore of the net proceeds from the fresh issuance to boost capital base and solidify solvency levels. The remaining funds will be used for general corporate reasons.