Business

Liberty General Insurance refutes stake sale rumours

Chennai, Aug 28 (IANS) Private non-life insurer, Liberty General Insurance Ltd on Friday denied media reports about a stake sale, saying that its promoters have infused fresh capital of Rs 100 crore and their holdings are subject to a five year lock-in.

In a statement, the company said: “Liberty General Insurance’ promoters, Liberty Mutual Insurance Group, Enam Securities, and D.P. Jindal Group remain confident of the company’s ability to build a substantial business in India.

“With a further infusion of additional capital of Rs 100 crore made in July 2020 by the promoters, the total invested capital including share premium is now Rs 1,834 crore.”

“This fresh infusion of capital by the promoters, amidst prevailing difficult economic situation in the country, indicates their commitment and confidence in Liberty General’s ability to grow profitably for many years to come,” said Roopam Asthana, CEO & Whole Time Director, denying media reports suggesting a stake sale.

According to the statement, the company had undergone a shareholding change in February 2018 and consequently the current promoters are subject to a lock-in period of five years as stipulated by the regulator.

The company has undergone several rounds of capitalisation thereafter and is financially strong with solvency ratio of 2.65 (as on June 30, 2020) as against required regulatory solvency ratio of 1.5, indicating adequate capital support for planned growth.

As to overall business, the company registered year-on-year growth of over 36 per cent for the year ended March 31, 2020.

With the economy not doing well and automobile sales going down, industry experts are expecting a flat of negative growth for the sector, thereby lessening the need for fresh capital.

“The additional Rs 100 crore is to cover growth ahead. We are planning on doing more business this year than last year,” Asthana had told IANS earlier.

–IANS

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