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News Topical, Digital Desk : The IDBI Bank privatization process has now reached a crucial stage. The Department of Investment and Public Asset Management (DIPAM) confirmed on Friday, February 6, that it had received financial bids for the bank's strategic disinvestment. On its official social media handle, DIPAM stated that these bids will now be evaluated as per the prescribed process, though it did not disclose the names of the bidders. However, according to market sources, Kotak Mahindra Bank and Fairfax India Holdings have emerged as the leading contenders.
The process has been ongoing for 3 years.
This development is part of a process under which the central government invited financial bids earlier this year. This privatization process has been ongoing for more than three years. The government aims to announce the successful bidder by March 2026, although regulatory approvals and procedural requirements are likely to delay the deal into the next fiscal year.
What is the government's plan? Under the proposed deal, the central government will sell its 30.48% stake in IDBI Bank, estimated to be worth approximately ₹36,000 crore at current market prices. In addition, the state-owned Life Insurance Corporation of India (LIC) will also sell its 30.24% stake. This brings the total stake up for sale to 60.72%, with a combined value of approximately ₹72,000 crore. Several companies initially submitted their interest in 2023, but the number of potential bidders has dwindled in recent months. Emirates NBD, which was previously in discussions, has now announced plans to buy a large stake in RBL Bank, reducing the likelihood of IDBI participating in the process. This deal is considered to be one of the largest stake sales in India's banking sector to date. It is also significant for the central government's asset monetization strategy. With both the government and LIC exiting the bank, the sale of IDBI Bank is being seen as a historic privatization.
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