Govt & LIC to sell 60.7% stake in IDBI Bank; revised bids under evaluation, deal likely within a month
New Delhi, July 14
The Government of India and state-run Life Insurance Corporation of India are moving ahead with the strategic sale of their combined 60.7 per cent stake in IDBI Bank, with revised financial bids from Canada's Fairfax Financial Holdings and Dubai-based Emirates NBD currently under evaluation. The disinvestment process is likely to be concluded within a month, government sources toldon Tuesday.
According to the sources, the revised bids are being examined, and a senior panel of bureaucrats reviewed the progress of the transaction during a meeting held on Monday.
The proposed transaction is part of the Centre's strategic disinvestment programme and involves the Government of India and LIC jointly divesting their combined 60.7 per cent stake in IDBI Bank.
At present, the Government of India holds a 45.48 per cent stake in IDBI Bank, while LIC owns 49.24 per cent.
Sources said the evaluation process is progressing, with the stake sale expected to be concluded within the next month, subject to the completion of the required procedures.
Canada's Fairfax Financial Holdings, founded by Indian-born Canadian billionaire Prem Watsa, and Dubai-based Emirates NBD are the contenders to acquire the controlling stake in IDBI Bank.
The proposed acquisition is estimated to be valued at around USD 5.7 billion at current market prices and, if completed, would rank among the largest foreign investments in India's banking sector.
At the time of reporting, IDBI Bank was trading at Rs 87.69 per share, up 4.31 per cent.
— ANI
Reader Comments
Interesting to see Canadian and Dubai-based firms vying for a controlling stake in an Indian PSU bank. USD 5.7 billion is a huge investment. But I wonder how this will impact IDBI's customers and employees. Hope the government ensures job security and service continuity.
About time! IDBI Bank has been a laggard for years. Letting a foreign investor take over might actually improve efficiency. But I hope the deal doesn't get stuck in red tape like so many other disinvestment plans. 😅
This is a classic case of selling the family silver. IDBI Bank has a huge branch network and customer base. Why are we giving it away to foreign entities? The government should have cleaned up its books and run it better. Disinvestment for the sake of it is not always good. Just my two paise.
A 60.7% stake sale is a bold step. Fairfax and Emirates NBD are both strong contenders. If Fairfax wins, it could bring in global best practices given Prem Watsa's Indian roots. Either way, this could be a win for India's banking sector if the new management focuses on growth and NPA reduction.
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