After the strategic sale, the 94.72 per cent stake of the government and LIC together will come down to 34 per cent in the bank.
The government is likely to make financial bids for IDBI Bank, under a strategic sale in September this year, said DIPAM (Department of Investment and Public Asset Management) Secretary Tuhin Kanta Pandey.
The 61 per cent of the government and Life Insurance Corporation’s (LIC) stake in the bank has attracted several institutions at the global and domestic level thus making preliminary bids last registered till 7 January 2023.
According to Pandey’s statement, the financial bids look forward at least before the next fiscal year’s second half (October-March). Meanwhile, DIPAM managing the government holding in state-owned enterprises had invited bids in October, for the 30.48 per cent stake sale in IDBI bank along with a 30.24 per cent stake in LIC.
After the strategic sale, the 94.72 per cent stake of the government and LIC together will come down to 34 per cent.
Commenting on the progress towards the strategic sale, Pandey said that the two sets of clearances work, security clearance from the government and Fit and Proper clearance from the RBI are expected to go on simultaneously.
The clearance helps the bidder qualify for a future process that includes signing a non-disclosure undertaking in the virtual data room, thus allowing due diligence and draft agreements sharing, according to him.
Respective agencies are subject to intensive work before the bidder’s qualification for the second round, the Secretary added without disclosing the timeline of clearances.
The investors who showcased expression of interest (EoI) are the first to submit the required information that secures the clearances, forwarding the details to the RBI and respective government agencies.
The expected transaction will get over in the second half of the next fiscal year beginning April 2023.
