Ace Investor Rakesh Jhunjhunwala has decided not to buy a stake in Chennai-based Star Health Insurance, which is being acquired by Safecrop Holdings, a source close to the matter told Zee Business. The decision was taken in the backdrop of the company’s valuation and its performance. Significantly, Star Health is the country’s first and largest standalone health venture.
Rakesh Jhunjhunwala was supposed to have taken a 33 per cent stake in the consortium. Reports had suggested that the capital committed by Jhunjhunwala was likely to be in the range of Rs 2,275-2,500 crore. The source also informed that the consortium has started looking for a new buyer as a replacement for Jhunjhunwala on the board.
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Safecrop Holdings is a consortium of private equity firms WestBridge Capital, Madison Capital and Rakesh Jhunjhunwala. The consortium in August 2018 signed a definitive agreement with the shareholders of Star Health & Allied Insurance Company, India’s largest health insurance company, to purchase their shares in the company for Rs 6,500 crore. Notably, Star Health has a market share of 10 per cent in the health insurance segment of India.
India’s largest health insurance company in terms of profits and premium Star Health is being acquired for a billion dollars by Rakesh Jhunjhunwala and a consortium led by WestBridge Capital.
Besides, the existing shareholders including ICICI Ventures, Sequoia Capital, Alpha TC Holdings, Oman Insurance and Tata Capital will exit from Star Health.
Zee Business approached Star Health, but the company declined to comment on the story.
Star Health was founded in 2006 and provides health insurance, overseas Mediclaim and personal accident policies.