The government has received financial bids for strategic disinvestment of IDBI Bank. Giving information in a post on ‘X’, Arunish Chawla, Secretary, Department of Investment and Public Asset Management (DIPAM) said that these bids will be evaluated as per the prescribed procedure. The process of privatization of IDBI Bank i.e. sale of government stake has been pending for more than 3 years. The government had invited Expression of Interest (EoI) to sell a total of 60.72 percent stake in this bank in collaboration with LIC in October 2022. DIPAM had said in January, 2023 that it had received several EoIs.
The proposal for sale of government stake in IDBI Bank first came in February 2020, when the Finance Minister presented the budget for FY 2021. On 6 February 2026, there was news that the government is going to complete the process of stake sale in IDBI Bank in this financial year. Kotak Mahindra Bank, Emirates NBD and Fairfax India Holdings are scheduled to submit their final bids to buy 61 percent stake this week.
Now the news is that Emirates NBD and Fairfax India Holdings have submitted the bid. However, Kotak Mahindra Bank has said that it has not submitted a financial bid for purchasing stake in IDBI Bank.
How much stake does the government have in IDBI Bank?
At present the Central Government holds 45.48 percent stake in IDBI Bank and Life Insurance Corporation of India (LIC) holds 49.24 percent stake. The government is selling its 30.48 percent stake in IDBI Bank. Officials say that the government is expected to get revenue of about Rs 33,000 crore from this. LIC is selling 30.24 percent stake in the bank.
Once the financial bids have been submitted, a reserve price will now be determined using respective methods as per the prescribed procedure, based on valuation by the Transaction Advisors and Asset Valuers. Thereafter, the sealed financial bids will be opened in the presence of Transaction Advisors, members of the Inter-Ministerial Group (IMG) and bidders or their authorized representatives.
According to news agency PTI, the successful bidder will be the one whose bid is the highest among all the valid bids and which is more than the reserve price. After this, the Alternative Mechanism (AM) authorized by the Cabinet Committee on Economic Affairs (CCEA) will meet and approve the highest priced bid. The AM consists of the Minister of Road Transport and Highways and the Minister of Finance.