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ICICI Lombard IPO to open on September 15

Monday, September 11, 2017
By A Business Reporter

Largest private sector non-life insurer ICICI Lombard has said promoter entities - ICICI Bank and Farifax Holdings -- will dilute their holdings by close to 19% through a public offer that will hit the markets on September 15 and mop up around Rs 5,700 crore.

With the IPO being carried out through offer for sale (OFS) route -- as the company is not issuing any fresh equities - ICICI Lombard will become the first general insurer to go public. The merchant bankers have fixed a price-band in the range of Rs 651-661 for the issue, which will open for subscription on Sept 15 and closes on Sept 19.

ICICI Lombard is a joint venture between ICICI Bank and Canadian NRI Prem Watsa-promoted Fairfax Financial Holdings. Through the upcoming IPO, these promoters will dilute up to 86,247,187 equity shares with a face value of Rs 10 each of ICICI Lombard. Post-issue, the shareholding of Fairfax will come down to 9.91% from 21.9% now (11.99% dilution), while ICICI Banks will come down by 7 percentage points to 55.95 from 62.95%.

"The company is now at a threshold where listing will give a positioning," Chanda Kochhar, MD and Chief Executive of parent ICICI Bank, told reporters while launching the IPO roadshow.

Commenting on the listing process, Bhargav Dasgupta, chief executive of ICICI Lombard, said the companys combined ratio as of end June was 102.4% and hence there was no immediate requirement of capital. The claim ratio of the company currently stands at 80%, he said, adding, "Around 15-20% growth rate in the overall premium was expected for the industry for the current fiscal."

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