Paytm to integrate Swiss RE in its insurance business with $100 mn infusion
- ByStartupStory | October 5, 2021
Paytm is in the final phase of negotiations to integrate Swiss RE as a strategic partner in its insurance business.
The Zurich-based reinsurance giant is looking to acquire a 20-25 percent stake in the company with an initial capital commitment of approximately $100 million, sources told ET. An official announcement is expected in the coming weeks, they said.
Last July, Paytm announced the acquisition of Raheja QBE, a Mumbai-based general insurance company, QBE Australia and its 51% domestic partner Prism Johnson of the S Raheja group for Rs 568 crore.
The acquisition would be channeled through QorQl, of which Sharma owns 51% and Paytm’s parent company One97 Communications the remainder. Sharma owns nearly 15% of One97 Communications. However, more than a year later, the acquisition is still awaiting regulatory approval. This is where Swiss RE comes in.
“Integrating a strategic partner at this stage will put a burden on regulators. Paytm lacks insurance expertise, which Swiss RE aims to provide,” said an informed official.
ET reported on July 29 that Sharma is considering a joint venture for its non-life insurance business. Raheja QBE, which mainly focuses on corporate coverage such as project liabilities, entered the retail insurance business with automotive and healthcare products in February.
The global reinsurer Swiss RE has been present in India since 1998. It founded Swiss RE Shared Services (India) in Bengaluru in 2000 and opened a service business in Mumbai in 2002 to support Swiss Re Zurich’s reinsurance business.
It was one of the largest reinsurers in the world and had built up significant exposure to the Indian life insurance industry through its reinsurance business until 2019. But since 2020, he is said to have limited his reinsurance exposure here, as the pandemic has caused heavy losses for life insurers in India.
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