The divestment deal of the country’s largest independent health insurer – Star Health Insurance is on track with the holding company Star Health Investments Private Ltd having kick-started the liquidation process.
Confirming the latest developments, Star Health & Allied Insurance Company Ltd CMD V Jagannathan said, the holding company had to be “collapsed,” thereby paving way for new investors to be formally integrated into the insurance company.
Since last year, the insurance entity has been in the news for attracting ace investor Rakesh Jhunjhunwala, who was eyeing a 35 per cent stake for a valuation of about Rs 2,500 crore. But, subsequently, there were talks of the deal getting scuttled.
According to latest media reports, Jhunjhunwala had recently said the company is in fact “awaiting approval from Insurance Regulatory and Development Authority (IRDA).” Safecrop Holdings, a consortium comprising WestBridge AIF, Rakesh Jhunjhunwala and Madison Capital, has signed definitive agreements with the stakeholders of Star Health & Allied Insurance Companies for the purchase of about 35 per cent stock in Star Health Insurance.
When asked about this, Dr S Prakash, COO, Star Health and Allied Insurance, confirmed that the same consortium remains central to the buying process. “The sale process is very much on and approvals are closely awaited.” The fund transfer is expected to be completed soon, latest by next month. As part of this, the liquidation of the holding company is a routine legal procedure, he reiterated. The holding company Star Health Investments, an unlisted private entity, was incorporated on August 4, 2005, with a paid-up capital of Rs 165.92 crore.
Having its registered office in Chennai, it has two directors, with its longest serving Board member being Khalid Abdul Khader Buhari. He has been on the Board for over 13 years now. Recently, Ahamed Shakir was co-opted as a director on August 10, 2017.
Buhari has the largest number of other directorships with a seat at a total of 28 companies, according to information available in the public domain.