Essel Finance Management has acquired insurance policy aggregator Bimadirect, which is operated by Coretree Insurance Brokers (India) Pvt. Ltd, a financial daily reported.
The acquisition was valued at Rs 25-30 crore, The Economic Times said, adding that the deal will see Essel Finance paying 75% of the deal amount upfront, and the rest over a period of two years.
The Hyderabad-based online insurance policy aggregator was founded in 2012 by IIM-Bangalore alumnus Amit Pandey, who had stints in Global Benefits Group and GE Insurance, before going on his own.
Earlier this year, Sudip Bandyopadhyay, the former head of Reliance Money, had bought a 50% stake in Bimadirect for an enterprise value of $7-8 million (Rs 47-54 crore).
The deal saw Bandyopadhyay and Pandey exit the company. The report said that Bimadirect was not profitable and, therefore, was considered a distressed asset. Pandey told ET that turning it into a profitable business required more capital and regulatory base, which could only be done by a bigger business.
According to Pandey’s LinkedIn profile, he has subsequently founded a business advisory firm, NewJove Group, based in Chicago.
Email queries to Essel Finance did not elicit any response till the time of writing this report.
The Subhash Chandra-promoted Essel Finance offers financial services, including SME business loans through its non-banking financial arm, housing finance, forex, private equity and investment banking, among others.
The group, which also has interests in media, industrial manufacturing, education and infrastructure, is aiming to become a financial services conglomerate, Chaturvedi had told VCCircle in November 2016. The acquisition of Bimadirect will allow the group to add insurance broking to its wealth management services.
The online insurance policy space consists of companies such as Policybazaar, Coverfox, and EasyPolicy among others. Earlier today, it was reported that venture capital firms True North and IDG Ventures will be investing in PolicyBazaar.
The development comes barely five months after it was reported that ETechAces Marketing and Consulting Pvt. Ltd, which operates PolicyBazaar, is close to raising a pre-initial public offering (IPO) funding round worth $50 million (about Rs 327 crore).
In June, Coverfox had raised a Series C round from new and existing investors, including New York-based venture fund Transamerica Ventures and Infosys co-founder NR Narayana Murthy, through his family office Catamaran Ventures. Thro und also saw Infosys co-founder Senapathy Gopalakrishnan and Sudha Gopalakrishnan invest in the company through Pratithi Investment Trust, among others.