The Union Cabinet on Wednesday approved the strategic sale of IDBI Bank to a Fairfax Group entity for around ₹52,000 crore. Union Minister Ashwini Vaishnaw said the Cabinet Committee on Economic Affairs (CCEA) had cleared the transaction, describing it as one of India’s largest foreign direct investment deals in the financial services sector.
Canada-based Fairfax Financial Holdings will acquire the stake through its subsidiary, 10955230 Canada Inc., the minister said.
The proposed transaction involves the sale of a combined 60.72% stake held by the Government of India and the Life Insurance Corporation of India (LIC). The government will divest 30.48% of the bank’s equity, while LIC will sell 30.24%, transferring majority ownership and management control to the strategic buyer.
The Centre currently holds a 45.48% stake in IDBI Bank, while LIC owns 49.24%, taking their combined shareholding to around 94.72%. Following the proposed divestment, the government’s stake is expected to decline to approximately 15% and LIC’s holding to around 19%, subject to the final transaction structure.
Ahead of the announcement, shares of IDBI ended 9.07% higher at ₹90.44 on the BSE, with a market capitalisation of ₹97,244.73 crore.