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IDBI Bank Stake Sale Faces Cancellation as Bids Miss Reserve Price

The Indian government's plan to sell a majority stake in IDBI Bank is likely to be cancelled after bids from Fairfax Financial Holdings and Emirates NBD reportedly fell short of the reserve price. The sale process, which has been ongoing for nearly three years, involved the government and LIC offloading a combined 60.72% stake with management control. IDBI Bank, which returned to profitability, recently posted a modest rise in quarterly net profit but saw a significant decline in net interest income. The strategic disinvestment was initially approved in 2021 with the aim of bringing in a buyer to infuse funds and new technology.

Key Points: IDBI Bank Stake Sale Likely Cancelled Over Low Bids

  • Bids below reserve price
  • Fairfax & Emirates NBD were bidders
  • Sale process lasted nearly 3 years
  • Govt & LIC aimed to sell 60.72% stake
2 min read

IDBI stake sale likely to be cancelled as bids fall short of reserve price

Government may scrap IDBI Bank stake sale after bids from Fairfax and Emirates NBD fall short of reserve price, ending a three-year process.

"The government's efforts to sell a majority stake in IDBI Bank are likely to be scrapped - Sources"

New Delhi, March 13

The government's efforts to sell a majority stake in IDBI Bank are likely to be scrapped, with both bids received below the reserve price, according to sources.

Fairfax Financial Holdings Ltd and Emirates NBD were the two bidders for the IDBI Bank sale, but their offers were reportedly lower than the government's reserved price.

The IDBI Bank stake sale process has been ongoing for nearly three years.

In 2023, the government and the Life Insurance Corporation (LIC) decided to offload a little over 30 per cent each in IDBI Bank. They issued a preliminary information memorandum, inviting EoIs for an aggregate 60.72 per cent stake, along with management control.

The Government of India and LIC together own more than 94 per cent of the equity of IDBI Bank (government 45.48 per cent, LIC 49.24 per cent.

The Mumbai-headquartered bank returned to profitability in recent years. It reported a 1.4% rise in its standalone net profit to Rs 1,935.45 crore in the October-December quarter of 2025, compared to Rs 1,908.27 crore in the same quarter of the previous year.

The lender's net interest income (NII) declined 24% to Rs 3,209.5 crore, compared to Rs 4,228.2 crore in the same quarter of the previous year.

The bank reported a drop in net non-performing assets (NPA) from Rs 474.2 crore in the previous quarter to Rs 425.3 crore in the quarter ended on December 31, 2025.

In May 2021, the Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi, gave its in-principle approval for strategic disinvestment along with the transfer of management control in IDBI Bank.

It was expected that the strategic buyer would infuse funds, new technology and best management practices for optimal development of business potential and growth of IDBI Bank Ltd and would generate more business without any dependence on LIC and government assistance or funds.

- ANI

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Reader Comments

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Priya S
Good decision to not sell at a lower price! IDBI is a national asset. Why rush to sell to foreign entities like Fairfax or Emirates NBD? Let it grow under LIC guidance. The NPAs are coming down, which is a positive sign. 🇮🇳
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Aman W
As a small investor, I'm relieved. The uncertainty around the stake sale was affecting the stock price. Now maybe we can see some stability and the bank can focus on improving its core operations. The 24% drop in NII is concerning though.
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Sarah B
From a market perspective, this shows global investors are cautious about Indian PSU banks despite the turnaround story. The government's disinvestment targets will take another hit this fiscal year. They need a new strategy.
K
Karthik V
Maybe it's a blessing in disguise. Let IDBI Bank continue its recovery journey without the disruption of a new management takeover. The employees must be happy hearing this news. Job security is important.
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Vikram M
Three years of process wasted! This reflects poorly on the execution of the disinvestment policy. Taxpayers' money and time spent on advisors, paperwork, etc. The government should have had a clearer minimum price from the start. 🤦‍♂️

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