Bank of Baroda has decided to divest up to 12.5% stake in its insurance arm, IndiaFirst Life Insurance Company, through an offer for sale in the initial public offer (IPO) of the insurer or any other mode. 

The bank's board of directors on Saturday approved divestment of 12.5% shares in IndiaFirst Life.

The bank's shareholding in the life insurance subsidiary will not fall below 51%. After buying Union Bank of India’s 21% stake last year, Bank of Baroda’s stake in IndiaFirst Life climbed to 65%.

Bank of Baroda said the divestment will take place by way of offer for sale or through any other method permissible under the law, subject to market conditions and approval of market regulator Sebi, Reserve Bank of India, and Insurance Regulatory and Development Authority (Irdai), and other authorities.

Carmel Point Investments India, owned by private equity funds managed by Warburg Pincus LLC., owns 26% of IndiaFirst Life and Union Bank of India 9%. 

As of March 2022, Mumbai-headquartered IndiaFirst Life had Rs 18,932 crore of assets under management.