The government requested bids for the privatisation of IDBI Bank on Friday, saying that, along with LIC, the government will sell a total of 60.72 per cent of the financial institution.
While inviting Expressions of Interest (EoI), the Department of Investment and Public Asset Management (DIPAM) stated that the potential investor must have a minimum net worth of 22,500 crore and must have reported net profit in three of the previous five years to be eligible for bidding for IDBI Bank.
A consortium would also be limited to a maximum of four members
The successful bidder would be obliged to lock in at least 40 per cent of the equity capital for a period of five years from the date of purchase.
It went on to say that the Reserve Bank will decide on the qualifying interested parties and the amount of equity share such organisations would have in IDBI Bank, and that the bidder would have to pass the banking regulator’s ‘Fit and Proper’ evaluation.
Potential purchasers have until December 16 to submit offers or Expressions of Interest (EoI).
Together, the government and LIC own 94.72 per cent of IDBI Bank. The Life Insurance Corporation (LIC) owns 529.41 crore shares, or 49.24 per cent of IDBI Bank, while the government owns 488.99 crore shares, or 45.48 per cent. The bank’s public shareholders own 5.2 per cent of the company.