The potential investors in IDBI Bank have received necessary security clearance from the Home Ministry, and approval from the Reserve Bank is expected to follow soon, an official stated on Thursday. The government, in collaboration with LIC, is selling almost 61% stake in IDBI Bank.
This includes a 30.48% stake of the Government of India and 30.24% of LIC. In January 2023, the Department of Investment and Public Asset Management (DIPAM) reported receiving multiple Expressions of Interest (EoI) for purchasing a stake in IDBI Bank. The bidders who have expressed interest through EoI need two clearances – one from the home ministry for security and the other from the Reserve Bank of India (RBI) to meet the ‘fit and proper’ criteria.
The RBI has been reviewing the details submitted by potential investors for over one-and-a-half years, causing a delay in the privatisation of the IDBI Bank. “Security clearance for potential bidders has already been obtained. Clearance from RBI is also expected soon,” the official informed PTI.
Following the necessary clearances, investors will gain access to the data room, and a due diligence process will be initiated, the official added.
IDBI Bank’s shares were trading at Rs 102.12, marking a 4.70% increase over the previous close on the BSE. The government and LIC together hold a 94.72% stake in IDBI Bank, which will decrease to 34% after the strategic sale. The government aims to raise Rs 50,000 crore from disinvestment and asset monetisation in the current fiscal year.