The Finance Ministry clarified that the reserve price for IDBI Bank's privatisation remained unchanged, while the revised bidding process increased the discovered bid value by ₹3,917 crore. The Union Cabinet approved the ₹52,878 crore sale of a 60.72% stake to a Fairfax Financial Holdings subsidiary on October 14, 2026.
The Ministry of Finance has clarified that the reserve price for the proposed strategic restructuring of IDBI Bank remained unchanged during the second round of bidding. However, the revised bidding process resulted in an increase of ₹3,917 crore in the discovered bid value.
According to the Ministry, the initial bidding process conducted during FY 2025-26 under the Department of Investment and Public Asset Management (DIPAM) guidelines was concluded after the initial offers were not approved. Subsequently, the Core Group of Secretaries on Disinvestment (CGD) finalised the procedure for the second round of bidding.
The government stated that two independent advisers conducted separate valuations using business and asset valuation methodologies. The business valuation considered market multiples of listed public sector banks, while the asset valuation also took into account factors such as disputed tax demands.
Regarding tax-related indemnity, the Ministry clarified that the potential liability amounted to ₹627 crore, whereas the discovered bid value increased by ₹3,917 crore. It further stated that reimbursement would arise only if the additional tax demand was actually paid.
The clarification comes amid concerns raised by IDBI Bank employees regarding reservation provisions, service conditions and pension benefits following the proposed privatisation.
On October 14, the Union Cabinet approved the sale of a 60.72% stake in IDBI Bank for ₹52,878 crore to a subsidiary of Canada's Fairfax Financial Holdings. Following the transaction, the Central Government and Life Insurance Corporation of India (LIC) are expected to retain 15% and 19% stakes, respectively.
Source: CA Sansaar