Sebi Clears Fairfax-backed Digit’s IPO After Delay

• ByStartupStory     |    March 4, 2024

India’s regulatory authority, the Securities and Exchange Board of India (Sebi), has granted approval for Digit Insurance to proceed with its initial public offering (IPO), following delays due to compliance issues. Originally planned for 2022, Digit’s $3.5 billion valuation faced setbacks as Sebi expressed concerns about the legality of certain share issuances, reported Reuters.

Digit, operating in the general insurance sector and backed by Canadian billionaire Prem Watsa’s Fairfax Group and A91 Partners, filed for the IPO in August 2022. Despite interruptions, the company, after addressing the compliance issues, refiled its IPO papers with Sebi in March last year. A letter sent on Friday to Digit and its IPO advisers, seen by Reuters, stated, “The proposed issue can open for subscription within a period of 12 months.”

While the letter did not specify earlier compliance issues or Sebi’s position, sources familiar with it indicated that the regulator is now satisfied with the IPO application. Digit declined to comment, and Sebi has not yet responded to requests for comment.

Digit intends to market its IPO to prospective investors over the next month, aiming for a listing by May, according to a person with direct knowledge of the matter. The company plans to raise 12.5 billion rupees ($151 million) through its listing, in addition to an offer for the sale of 109.4 million shares, as outlined in its prospectus.

Digit’s listing plans align with the current record boom in India’s stock markets and public listings. Bankers anticipate 2024 to be one of the country’s most significant years for IPOs, reported Reuters earlier.

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