The sale of IDBI Bank is set to get delayed as the date for submission of Expression of Interest (EoI) is likely to be extended to the next month. Earlier, the scheduled date was December 16.

A senior government official said transaction advisors have received a few requests for an extension of the deadline. “Since foreign investment bankers will not be working due to year-end holidays, the deadline will be extended till early January,” the official said on Friday.

Sale process

Though the bank is categorised under the private sector with effect from January 21, 2019, after the Life Insurance Corporation of India acquired a majority stake, the government still owns 45.48 per cent of equity. LIC has 49.24 per cent. The plan is that the government will sell 30.48 per cent stake and LIC 30.24 per cent stake, aggregating to 60.72 per cent of the equity share capital of IDBI Bank, along with the transfer of management control. The successful bidder will have to make an open offer of acquisition of 5.28 per cent of the public shareholding.

Earlier, the Department of Investment and Public Asset Management (DIPAM) had said the potential buyers should have a minimum net worth of ₹22,500 crore and must report a net profit in three out of the last five years to qualify for bidding. In addition, a maximum of four members would be permitted in a consortium. Also, the successful bidder would be required to mandatorily lock in at least 40 per cent of the equity capital for five years from the date of acquisition.

In an interview to businessline, DIPAM Secretary Tuhin Kanta Pandey had said: “As this is the process through competitive bidding for a bank, we will wait for the bidders’ responses, and subsequently, how they view it, how much time it takes for due diligence. Our expectation is that financial bids may be possible before March.”

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