India has received revised bids from Fairfax Financial and Emirates NBD for the purchase of its stake in IDBI Bank, as the long-running privatisation process moves into a crucial stage.
The updated offers are being assessed, with a high-level group of bureaucrats having met on 13 July to review the proposed transaction. According to government sources cited by ANI, the disinvestment exercise is expected to be wrapped up within a month.
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The government of India and state-run Life Insurance Corporation of India (LIC) are proceeding with plans to sell their combined 60.7% stake in IDBI Bank. The government currently holds 45.48% in the lender, while LIC owns 49.24%.
Based on prevailing market valuations, the deal is estimated at roughly USD 5.7 billion. If finalised, it would be one of the biggest foreign investments in India’s banking sector, ANI reported.
The sale process had earlier faced a setback.
In March, Bloomberg reported that the Indian government’s effort to divest a majority stake in IDBI Bank was paused because the bids submitted fell short of the minimum price requirement.
Although officials did not formally identify the bidders, earlier reports had named Canada-based Fairfax Financial, led by billionaire Prem Watsa, and Dubai’s Emirates NBD among the parties interested in securing a controlling stake in the bank.
Bloomberg also reported in May that Indian authorities were weighing adjustments aimed at reigniting buyer interest after the most recent push to privatise the lender lost momentum. Among the options under consideration was a reduction of as much as 20% in the reserve price.
Other recent overseas investments in India’s banking industry include Emirates NBD’s acquisition of a 60% stake in RBL Bank and Sumitomo Mitsui Banking Corp’s purchase of a 24% stake in Yes Bank.
Besides, the Reserve Bank of India approved Asia II Topco XIII, a Singapore-based Blackstone affiliate, to acquire as much as 9.99% of Federal Bank’s paid-up share capital or voting rights.
