The mega-merger brewing in India’s insurance marketplace

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Subscribe to enjoy similar stories. InsuranceDekho, backed by TVS Capital Funds and Investcorp, is in advanced talks to merge with smaller peer RenewBuy in a cash-and-stock deal, according to two people familiar with the matter, in a transaction that will create India’s second-largest insurance aggregator. The deal will create India’s largest insurance marketplace by value after PolicyBazaar, which went public in 2021, the people cited above said, asking to remain anonymous.

“The combined entity will be valued at over ₹8,000 crore and is expected to raise another round of funding before it considers a public listing," one of the people cited above said. “The term sheets have been issued," the second person said, adding that the final deal contours are still being discussed. The potential deal is set to value RenewBuy at approximately ₹3,000 crore and InsuranceDekho at a little over ₹5000 crore.

“Some of the early investors of Renewbuy are expected to sell some of their stakes," the person said. InsuranceDekho and Renewbuy did not immediately respond to Mint's queries. India is the world's fifth largest life insurance market that is expected to reach $222 billion by 2026, growing at a rate of 32-34% each year, according to International Brand Equity Foundation estimates.

In June, Mint exclusively reported that InsuranceDekho was in early talks to raise $150 million in a mix of primary and secondary transactions and had appointed Avendus to facilitate the process. This fundraise will now happen in the merged entity, the people cited above added. The development comes about a year after InsuranceDekho raised $60 million in its Series B round at a valuation of $630 million.