 "IDBI Bank surges 11% as govt invites bids for strategic divestment")
Shares of IDBI Bank rallied 11 per cent to Rs 47.40 on the BSE in Monday's intra-day trade, in an otherwise a weak market, after the finance ministry invited initial bids for strategic disinvestment in the lender. The government aims to jointly sell 60.7 per cent stake in the lender along with the Life Insurance Corporation (LIC).
At 09:16 AM, the stock was trading 9 per cent higher at Rs 46.65, as compared to 1.2 per cent decline in the S&P BSE Sensex. A combined 6.9 million shares changed hands on the NSE and BSE in th first few minutes of trading. In the past three months, IDBI Bank's market price has appreciated nearly 50 per cent, as against 6 per cent rise in the benchmark index.
"Pursuant to the strategic disinvestment of IDBI Bank, the government shall sell such number of shares representing 30.48 per cent; and LIC shall sell such number of shares representing 30.24 per cent, aggregating to 60.72 per cent of the equity share capital of IDBI Bank, along with transfer of management control in IDBI Bank," the bank said in an exchange filing. READ HERE
The government of India currently holds 45.48 per cent, and LIC holds 49.24 per cent of the total equity share capital of the IDBI Bank.
According to the expression of interest (EoI), the entities eligible to bid for IDBI Bank include private-sector banks, foreign banks, non-banking financial companies (NBFCs), alternative investment funds (AIFs) registered with the Securities and Exchange Board of India, or any other fund incorporated outside India. The bidder may submit its EoI solely on its own or as part of a consortium.
The successful bidder will have to bring down the equity to 26 per cent in 15 years, and in the first five years from the date of acquisition 40 per cent of the equity capital will remain locked in, according to central bank guidelines.
At 09:16 AM, the stock was trading 9 per cent higher at Rs 46.65, as compared to 1.2 per cent decline in the S&P BSE Sensex. A combined 6.9 million shares changed hands on the NSE and BSE in th first few minutes of trading. In the past three months, IDBI Bank's market price has appreciated nearly 50 per cent, as against 6 per cent rise in the benchmark index.
"Pursuant to the strategic disinvestment of IDBI Bank, the government shall sell such number of shares representing 30.48 per cent; and LIC shall sell such number of shares representing 30.24 per cent, aggregating to 60.72 per cent of the equity share capital of IDBI Bank, along with transfer of management control in IDBI Bank," the bank said in an exchange filing. READ HERE
The government of India currently holds 45.48 per cent, and LIC holds 49.24 per cent of the total equity share capital of the IDBI Bank.
According to the expression of interest (EoI), the entities eligible to bid for IDBI Bank include private-sector banks, foreign banks, non-banking financial companies (NBFCs), alternative investment funds (AIFs) registered with the Securities and Exchange Board of India, or any other fund incorporated outside India. The bidder may submit its EoI solely on its own or as part of a consortium.
The successful bidder will have to bring down the equity to 26 per cent in 15 years, and in the first five years from the date of acquisition 40 per cent of the equity capital will remain locked in, according to central bank guidelines.
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