The Indian government is reportedly close to accepting a revised offer from Fairfax Financial Holdings Ltd. for the acquisition of a stake in IDBI Bank Ltd. The Canadian investment firm may increase its per-share bid by a few rupees after its initial valuation was rejected for being below the government’s reserve price, according to sources familiar with the matter.
The proposed transaction requires final approval from the Union Cabinet and the Reserve Bank of India before it can proceed. The Finance Ministry and Fairfax Financial have not issued any official comments on the development.
Fairfax Financial, founded by Indian-born Canadian billionaire Prem Watsa, has emerged as the leading contender for the stake purchase, while Emirates NBD PJSC was also among the bidders. The company recently brought capital into India ahead of the potential acquisition, according to earlier reports.
The government has been attempting to sell its controlling stake in IDBI Bank for several years as part of its disinvestment programme. A successful transaction would mark one of the largest government-backed exits from a domestic bank in recent years.
The deal is being closely watched as it could reshape ownership in one of India’s major financial institutions while attracting greater private sector participation in the banking industry. The completion of the transaction would also represent a significant milestone in the government’s broader privatisation strategy.
