The strategic stake sale of Government of India and Life Insurance Corporation of India (LIC) in IDBI Bank is set to move into the second phase. DIPAM secretary on Saturday said that the government has received several expressions of interest (EoI) for disinvestment of IDBI Bank. Both the government and LIC are looking to reduce their holding of 60.72% together in the Mumbai-headquartered lender.
Tuhin Kanta Pandey, Secretary, Department of Investment and Public Asset Management (DIPAM), said in an official tweet, “Received multiple Expressions of Interest for strategic disinvestment of Government & LIC’s stake in IDBI Bank.”
“The transaction will now move to the second phase,” the secretary added.
DIPAM invited Expression of Interest (EOI) for strategic disinvestment of total 60.72% stake in IDBI Bank by Government of India and LIC along with transfer of management control. The late date for submission of EOI was earlier revised to January 7, 2023 from December 16, 2022. The last date for submission of physical copies of EOI has been revised to January 14.
Notably, to enable new investors to meet the minimum public shareholding norm, earlier this week, markets regulator SEBI allowed the government to list its stake in IDBI Bank as ‘public’ before the due date of submission of EOI. was allowed to be reclassified as
Also, on Monday, amid the open offer, the finance ministry announced an exemption to the new buyer of the bank, which would enable them to retain 25% minimum public shareholding in IDBI Bank.
IDBI Bank shares on Friday 59.05 on BSE up 7.85%. Its market cap is around 63,492.93 crores.
The Center had informed that “there may be no impact on the primary dealer business of IDBI Bank”.
Under the strategic disinvestment, the government plans to sell 30.48% stake and the country’s largest insurer, LIC, will offload 30.24% shareholding in IDBI Bank – taking the total stake sale to 60.72%.
As on March 31, 2022, LIC is the largest shareholder in IDBI Bank holding 529.41 crore equity shares or 49.24%. While the government held 488.99 crore equity shares or 45.48% stake in IDBI Bank.
The disinvestment has been divided into two successive phases. In the first stage, Expression of Interest (EoI) is invited, and bidders shortlisted after ‘fit and proper’ assessment checks by RBI and security clearance by Government of India/Ministry of Home Affairs are qualified as Qualified Interested Parties (“QIPs”). Will be notified in The second stage is where the QIP will be provided with a request for proposal document (“RFP”) and additional details of IDBI Bank and seeking financial bids on the terms detailed under the RFP.
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