The government is holding roadshows for IDBI bank privatization and will issue an Expression of Interest (EoI) after evaluating investor interest, State Finance Minister Bhagwat Karad said on March 21.
In May last year, the Cabinet Committee on Economic Affairs approved the strategic divestment and transfer of management control in IDBI Bank. The government and LIC together own more than 94% of IDBI Bank’s capital. However, the exact extent of the share dilution has yet to be decided.
In a written response to Lok Sabha, Mr. Karad said the strategic buyer is expected to inject funds, bring new technology and best management practices to IDBI Bank and generate more business without depending on the LIC and the government for capital be.
LIC, which currently has management control, owns 49.24% of the shares while the government owns 45.48% of the bank. The non-promoter portion is 5.29%. “…roadshows are currently being held to assess investor interest before the EoI is released,” said Mr. Karad.
The minister said that when deciding on the terms of the strategic sale, legitimate concerns of existing employees and other stakeholders will be duly addressed through appropriate provisions in the share purchase agreement.