IDBI Bank Shares Rise Over 3% After Reports Of Govt Approval For Strategic Disinvestment
· Free Press Journal
Shares of IDBI Bank gained more than 3% in early trade on Tuesday after reports suggested that the government has approved the strategic disinvestment of the lender.
At 11 am, the stock was trading at Rs 86.75 on the NSE, up 3.51%.
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The rally came after CNBC-TV18 reported, citing sources, that the government had given approval for the strategic sale of IDBI Bank.
The development follows a series of high-level meetings held by the government on July 13 to review the long-pending disinvestment process.
Moneycontrol had earlier reported that two meetings of the Core Group of Secretaries on Disinvestment (CGD) were held during the day to discuss matters related to the stake sale.
IDBI Bank Disinvestment Revives As Fairfax Submits Fresh Bid Of $5 BillionAn Inter-Ministerial Group (IMG) also met to assess the progress of the strategic disinvestment.
The meeting was jointly chaired by Sanjay Lohiya, Secretary, Department of Financial Services, and Arunish Chawla, Secretary, Department of Investment and Public Asset Management (DIPAM).
The strategic sale of IDBI Bank has faced delays due to valuation concerns and differences between the government and potential bidders.
Earlier reports suggested that offers from shortlisted suitors were below the government’s expected valuation, prompting a review of the process and fresh discussions.
IDBI Bank Stake Sale: Govt Examining Legal Provisions To Accept Bids Below Reserve PriceThe government and Life Insurance Corporation of India (LIC) together hold nearly 95% stake in IDBI Bank.
As part of the proposed transaction, they plan to divest a combined 60.72% stake along with management control of the lender.
The Centre is expected to sell its 30.48% holding, while LIC will divest 30.24% of its stake.
The move is aimed at transferring management control to a private investor and reducing government ownership in the banking sector.
Canada-based Fairfax Financial Holdings has emerged as one of the key contenders for the acquisition.
Fairfax India Holdings had submitted an Expression of Interest (EoI) for the proposed transaction and remains among the bidders participating in the strategic disinvestment process.
The stake sale is expected to mark a significant step towards the privatisation of IDBI Bank, which has been part of the government’s broader disinvestment strategy aimed at attracting private investment and improving efficiency in state-linked enterprises.