- One97 Communications-owned company Paytm is in talks to buy Mumbai-based insurance firm Coverfox in an all-cash deal worth $100-120 million.
- It will be the largest acquisition by the Paytm on the online platform.
- Coverfox gives benefits for both life and non-life insurance policies.
Paytm the Softbank funded company is likely to acquire Mumbai-based digital insurance marketplace Coverfox for $100-120 million in an all-cash deal.
If the transaction goes through then it will be the largest acquisition by the Paytm on the online platform. It will also emerge as a direct competitor to insurance aggregator PolicyBazaar, Which is also funded by SoftBank.
Softbank Vision Fund, a major investor in One97 Communications, parent of Paytm, is also an important shareholder in PolicyBazaar, who can meet the challenges for this deal, people close to the development said. “The Paytm Board is in the process of finalizing the outline of the deal”.
“There is still a chance that it could fall because the board deliberates on the pros and cons of the transaction”.
Coverfox can bring benefits as well for both life and non-life insurance policies. It has 50,000 agents and offers products from 45 insurance companies. The company sold premiums worth $100 million through its platform and it generated $22 million in revenue with a million transactions done in the last year. Coverfox is the term which is very useful for life insurance products in the future.
Coverfox is founded by Varun Dua and Devendra Rane in the year 2013. It has been in talks to raise a $50 million series D round even as the acquisition talks have been going on in parallel, another source told ET.