SEBI agrees with Digit’s reasoning and has decided to remove the “suspended” status from the IPO.
Mumbai:
SEBI will resume a review of an initial public offering from Digit Insurance worth $440 million after the company resolved certain compliance issues that led the regulator to put the process on hold, two sources told Reuters on Friday.
The Securities and Exchange Board of India (SEBI) “suspended” Canadian billionaire Prem Watsa-backed Digit Insurance IPOs earlier this month, saying certain observations had been made, but went no further.
Reuters previously reported that the regulator was concerned that privately-held Digit issued shares to more than 200 individuals in the past fiscal year, which is not allowed under Indian laws and regulations.
According to one of the sources, Digit explained to the regulator about the share issue, which according to the company did not violate the regulations.
SEBI agrees with Digit’s reasoning and has decided to remove “suspended” status from Monday’s IPO and restart the review process, the two sources said, but declined to be identified as the decision is not yet public. .
A Digit spokesperson declined to comment, while SEBI did not respond to a request for comment.
Digit Insurance, which is also backed by Indian investment firm TVS Capital Funds and Sequoia Capital, is looking to raise approximately $440 million for its non-life insurance business through an IPO. Sources have said it is looking for a valuation of between $4.5 billion and $5 billion.
Digit, founded in 2017, is trying to expand in non-life insurance. Separately, it is entering the life insurance market with its Go Digit Life business.
The prospectus filed by the company last month showed that the IPO will consist of new shares worth 12.5 billion Indian rupees ($158 million), while existing stakeholders will sell up to 109.4 million shares.
