Indian Cabinet Approves Sale of IDBI Bank Stake to Fairfax Financial for ₹52,878 Crore
The Indian Cabinet has approved the sale of a 60.72% stake in IDBI Bank to Fairfax Financial for ₹52,878 crore, marking a significant financial move.
New Delhi, October 14 (Daily Kiran) : The Indian Cabinet has granted approval for the sale of a significant stake in IDBI Bank to Fairfax Financial Holdings. This decision, made on October 14, 2026, will see Fairfax acquire a 60.72% stake in the bank for ₹52,878 crore.
The transaction involves purchasing 30.48% of the stake from the government and an additional 30.24% from the Life Insurance Corporation (LIC). Following this deal, the government’s share in IDBI Bank will decrease to 15%, while LIC’s stake will remain around 19%.
Finance Minister Nirmala Sitharaman characterized this transaction as a “strategic restructuring” rather than a mere divestment. She emphasized that both the government and LIC will retain their stakes in the bank.
The Cabinet’s decision is set to be implemented through a two-phase competitive bidding process. This approach received backing from a multi-tiered decision-making system, which included an inter-ministerial group, a core group of secretaries on divestment, and a group of empowered ministers.
According to a statement from the Finance Ministry, two professional valuation agencies assessed the bank’s fair value, arriving at an average of ₹75.99 per share. Fairfax’s bid of ₹81 per share exceeded this benchmark and the valuations provided by the independent agencies, leading to its approval.
The successful bidder will need to present proof of eligibility to the Reserve Bank of India, based on the “fit and proper assessment” conducted during the Expression of Interest phase. They must also submit a roadmap to meet the regulatory conditions outlined. Upon completion of this process, the sale will represent the largest Foreign Direct Investment (FDI) in India’s financial sector to date.
