Sebi approval for a Reliance Insurance IPO had lapsed in November 2018. (iStockphoto)
Sebi approval for a Reliance Insurance IPO had lapsed in November 2018. (iStockphoto)

Reliance Insurance files fresh IPO papers after Sebi nod lapses

  • Reliance Insurance has removed Edelweiss as one of the lead merchant bankers to manage the IPO
  • Reliance Insurance IPO comprises fresh issue of shares worth 200 crore and an offer for sale of 79,489,821 shares by Reliance Capital

New Delhi: Reliance General Insurance, part of Anil Ambani-led Reliance Group, has filed fresh papers with the Sebi to float an initial share-sale after the regulatory approval for its IPO lapsed in November, people aware of the development said Monday. According to the people, Reliance Insurance IPO comprises fresh issue of shares worth 200 crore and an offer for sale of 79,489,821 shares by Reliance Capital.

Reliance Insurance has removed Edelweiss as one of the lead merchant bankers to manage its initial public offer (IPO), the people added.

The removal comes following the the Reliance Group accusing Edelweiss Group entities of "illegal" and "motivated" actions in invoking the pledged shares of the group's three listed firms and selling them in open market causing a steep fall in share values.

Further, it has appointed CLSA India and IndusInd Bank replacing UBS and IDBI Capital. It has also roped in Yes Securities. Other merchant bankers—Motilal Oswal Investment Advisors, Credit Suisse Securities, Haitong Securities—will continue to be associated with the Reliance Insurance IPO.

Reliance Insurance had filed its draft IPO papers in October 2017 for which it received Sebi's approval in November 2017. The approval, which is valid for one year, expired on 29 November 2018, according to data available with the Securities and Exchange Board of India (Sebi).

Reliance Insurance had failed to tap primary markets as lack of investor appetite for the IPO and volatile equity market conditions had forced the insurer to postpone its plans.

According to Sebi regulations, a firm gets one year to hit the primary market after receiving regulatory approval for an IPO.

In case a firm fails to do so, it has to refile the draft red herring prospectus (DRHP).

The Reliance Insurance IPO comprised fresh issue of a little over 1.67 crore shares by the company and an offer of sale of 5.03 crore shares by Reliance Capital.

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