South African fund shows interest in Indian insurance

September 7th, 2011 - 7:38 pm ICT by IANS  

Chennai, Sep 7 (IANS) South Africa-based private equity fund LeapFrog Investments wants to invest in Indian insurance companies as well as those serving the insurance sector.

“We are interested in investing in insurance companies - operating in life, non-life and health sectors - as well as in companies serving this sector like information technology (IT), claims processing outfits and others,” Jim Roth, co-founder and partner of the company, told IANS.

The $135 million private equity fund invests in insurance and financial service companies in Africa and Asia that are focused on emerging consumers largely from middle and lower middle class.

He said there are many insurance companies in India without any foreign partners and LeapFrog Investments can bring its insurance expertise to them.

“We cap our investment per company at $30 million. We can be a knowledge partner for the Indian insurers as we have actuaries in our team,” he added on the sidelines of a press meet announcing the fund’s investment in the city-based Shriram Credit Capital Ltd.

“LeapFrog is investing Rs.67 crore (around $15 million) for around 10 percent stake in Shriram Credit Capital. The funds will be deployed in our three group companies operating in the fields of stock broking, financial product distribution and wealth advisory services,” G.S. Sundararajan, managing director, Shriram Capital Ltd. told reporters here Wednesday.

Shriram Capital is the holding company for the financial services (including Shriram Credit Capital) and insurance companies (life and non-life) of the Shriram group.

According to Sundararajan, the newly infused funds will be used to expand the operations of Shriram Insight Share Brokers (stock broking outfit), Shriram Fortune Solutions (financial products distribution company) and Shriram Wealth Management (designers of financial products).

“We will increase the number of Shriram Fortune (revenue Rs.120 crore) branches by 600 to 1,000. The expansion will happen in south (India). Similarly, we will expand the reach of Shriram Insight (revenue Rs.250 crore) by opening new branches in northern and western parts of India,” Sundararajan said.

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