Home / Companies / News /  UK's Bay Capital announces pre-IPO investment in Policybazaar

UK-based fund manager Bay Capital said in a release on Wednesday that it has become the latest overseas fund to invest in Gurugram-based company PB Fintech (formerly, Etechaces Marketing and Consulting), the holding company of Policybazaar.

On Tuesday, Mint first reported that Bay Capital has come in as a pre-initial public offering (IPO) investor in PB Fintech Pvt. Ltd, the holding company of Policybazaar, which is set to go public through a 4,000 crore share sale.

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Siddharth Mehta, founder and Chief Investment Officer of Bay Capital, said, “We are excited to partner with the excellent management team of PB Fintech, which is transforming the way insurance is bought in India. Customer centricity has been the heart of their proposition and has helped them become the platform of choice for customers."

Gurugram-based Policybazaar, India’s largest online insurance comparison website, has attracted immense interest from a bunch of large investors before the company’s IPO.

The SoftBank-backed insurance aggregator’s other key investors include True North, Tencent, Tiger Global, Premji Invest, Temasek, Info Edge India Ltd and Ribbit Capital.

Policybazaar is India’s second fintech startup to get unicorn status, after Paytm, and will be the first company to be listed from the country’s financial aggregator space.

Yashish Dahiya, founder and group chief executive officer of PB Fintech, said, "We are delighted to welcome Bay Capital onto our cap table. We've known Bay Capital and Sid for quite some time, and are very happy to have them join us for this next phase of Policybazaar’s journey. Bay Capital is a long-term investor and we see them playing a key role as Policybazaar heads towards the public markets in the next 12-15 months."

Several existing investors in Policybazaar want to monetize some of their stakes in the company, while some investors may look for a complete exit via the IPO. So, the IPO is likely to be a combination of fresh issuance and an offer for sale (OFS).

SoftBank and Singapore’s Temasek Holdings Pte each hold about 15% in Policybazaar, while Tencent and Tiger Global own about 10% and 8%, respectively.

Policybazaar became a unicorn in 2018 when it raised $200 million in a Series F round led by SoftBank. Paytm became a unicorn in 2017.

Bay Capital is an India-focused investment management firm, which manages money on behalf of institutions and endowments based in the US and Europe. According to the Securities and Exchange Board of India, anchor investors can invest up to 250 crore in Policybazaar in the IPO.

Policybazaar may allocate up to 60% of the portion available for allocation to qualified institutional buyers to anchor investors a day before the IPO opening.

In an IPO, at least two and a maximum of 15 anchor investors are allowed to be allocated up to 250 crore worth of shares.

On 15 February, Mint reported that Policybazaar is launching a 4,000 crore IPO at a valuation of at least $3.5 billion

Bay Capital has completed a secondary transaction, ahead of the insurance aggregator’s plans to launch an IPO.

"With its extremely long term horizon, Bay Capital has built an impressive portfolio of franchises straddling along the growth opportunities in India in areas such as consumer, digital, finance, outsourcing and health," said Bay Capital.

"The company’s tech focused approach has been a key enabler in ensuring better transparency, decreasing costs, and increasing adoption in the country over the last 12 years. We believe PB Fintech is well-positioned to become one of the largest financial services e-commerce company in India and is poised for a strong growth trajectory in the years to come," added Mehta.

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