The process of privatization of IDBI Bank by the government is on and the quantum of stake sale will be decided after the promotional work is over. This information has been given by Tuhin Kant Pandey, Secretary, Department of Investment and Public Asset Management (DIPAM).
Pandey said, “The quantum of stake to be sold in IDBI Bank will be known after the publicity is over. After that the structure of the Expression of Interest (EoI) will be finalised. One thing is clear that it will be handed over managerial control.” which is with LIC at present. Once we finalize the structure of the EOI, it will also be decided how much of the equity to be controlled by managerial control.”
Decision on entire stake possible: The government may decide to sell its entire stake in IDBI Bank in one go or in installments but it will depend on the sentiment from the investors. The government holds 45.48 per cent stake in this bank while LIC holds 49.24 per cent.
The Cabinet Committee on Economic Affairs had given in-principle approval for strategic disinvestment and transfer of managerial control of IDBI Bank in May 2021 itself.
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To make way for this disinvestment, necessary changes have been made in the IDBI Bank Act through the Finance Act 2021. Apart from this, transfer advisors have also been appointed.
Meanwhile, the Board of Directors of IDBI Bank has approved the appointment of two Government Nominee Directors. The bank told the stock exchanges on Friday that the government had named Manoj Sahay, joint secretary and financial advisor, and Sushil Kumar Singh, director, department of financial services, ministry of finance. Both these appointments have been made effective from April 28.