Sachin Bansal, co-founder of e-commerce giant Flipkart, is in talks with Kishore Biyani's Future Group to buy out its life insurance JV arm Future Generali India Life Insurance Co. Ltd. Bansal's financial services startup Navi Technologies is likely to acquire the Future Group's insurance firm for Rs 1,400-1,500 crore.
The deal is in a formal proposal stage and is likely to be announced soon. The embedded value of Future Generali Life is estimated to be around Rs 800 crore and a multiple of 1.5-2 times, which seems to be a decent valuation as per the industry standards, Mint reported citing sources.
Earlier there were reports that debt-ridden Future Group may exit both its general and life insurance businesses by offloading its controlling stakes in the two JVs it has with Generali Participations Netherlands N.V.
Future Generali Life is a three-way joint venture between Future Group, BSE-listed NBFC Industrial Investment Trust Limited (IITL) and Italian insurance Group Generali. Biyani's Future Group owns 57.62 per cent stake in the insurance JV, while IITL and Generali hold 16.88 per cent and 25.5 per cent, respectively.
Bansal, who exited Flipkart in 2018, co-founded financial services startup Navi Technologies in December of that year, along with Ankit Agarwal. This is his second entrepreneurial venture in the financial services space after moving out of Flipkart following its acquisition by global retailing giant Walmart. In January this year, Navi Technologies' microfinance arm, Chaitanya India Fin Credit Pvt. Ltd (CIFCPL), had approached the Reserve Bank of India (RBI) for a universal banking licence.
On Saturday, Future Group sold its retail, wholesale, logistics and warehousing business to Mukesh Ambani's Reliance Retail Ventures (RRVL) for Rs 24,713 crore on slump sale basis. According to sources, the value of Rs 24,713 crore includes Rs 12,000 crore debt of Future Group. After the deal, the FEL will have surplus cash and debt of around Rs 3,000- 4,000 crore, said sources.
Reliance will pay Rs 24,713 crore for the key formats of Future group such as Big Bazaar, fbb, Foodhall, Easyday, Nilgiris, Central and Brand Factory, besides the logistics and warehousing business.
By Chitranjan Kumar