Patanjali and DS Group Acquire Magma General Insurance in Rs4,500 Crore Deal
Moneylife Digital Team 17 March 2025
In a significant move that marks Patanjali Ayurved's first major foray into the financial services sector, Baba Ramdev's company and the Dharampal Satyapal group (DS group) have acquired a majority stake in Magma General Insurance from Adar Poonawalla-owned Sanoti Properties. The deal, valued at Rs4,500 crore ($517 million), will give Patanjali a controlling 98% stake in the insurance company, subject to regulatory approvals.
 
The board of Magma General Insurance approved the share purchase agreement on 12 March 2025. The selling entities include: Sanoti Properties LLP, which held 72.5% in the insurer as of November 2024, along with Celica Developers Private Limited and Jaguar Advisory Services Private Limited. Sanoti Properties is jointly owned by Adar Poonawalla (90%) and Rising Sun Holdings (10%).
 
The acquisition values Magma General Insurance at 1.37 times its gross written premium (GWP) for FY23-24, with the insurer reporting a GWP of Rs3,295 crore. Despite posting a loss of Rs141 crore in FY24, the company maintained a half-year solvency ratio of 1.77, well above the regulatory requirement of 1.5.
 
Ambit Private Limited acted as the exclusive financial advisor for the transaction, while Khaitan & Co and Wadia Gandhy & Co served as legal advisors to the selling shareholders.
 
The transaction remains subject to approvals from several regulatory bodies, including the Insurance Regulatory and Development Authority of India (IRDAI), the competition commission of India, and the company's debenture-holders. Once completed, the new owners plan to inject additional capital to expand the company's operations.
 
For Patanjali Ayurved, established in 2006 as a manufacturer and marketer of herbal and nature-based products, this acquisition represents a strategic diversification beyond its core business of ayurvedic and consumer goods into the financial services sector.
 
Magma General Insurance, which offers more than 70 products across retail and commercial insurance categories, holds a 1.05% market share in the non-life insurance segment. The company has a presence across motor, health, property and other commercial lines. It expects to close FY24-25 with a GWP of Rs3,650 crore to Rs3,700 crore, up from Rs3,295 crore in FY23-24.
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