Digital financial services firm One97 Communications Limited (OCL), which operates under the Paytm brand, said on Saturday that it has set up a joint venture (JV) general insurance company in which it has committed to invest Rs 950 crore over a 10-year period.
The proposal to form a joint venture Paytm General Insurance Limited (PGIL) was approved by Paytm’s board on May 20, the company said in a regulatory filing.
Initially, OCL will own a 49 percent stake in PGIL, while the remainder of the 51 percent stake will be owned by OCL’s Managing Director Vijay Shekhar Sharma, led by VSS Holding Private Limited (VHPL).
Following the investment, Paytm will hold a 74 percent stake in PGIL, reducing VHPL’s stake in the company to 26 percent.
The decision of Paytm’s board came after the group company’s transaction in a share purchase agreement to acquire Raheja QBE General Insurance Company Limited was not completed on time.
In the exchange application, OCL said it has reappointed Sharma as general manager for five years. Madhur Deora, the company’s group CFO and president, has been appointed to the board as a full-time director for the next five years.