The Cabinet Committee on Economic Affairs cleared Fairfax Financial Holdings' bid for a 60.72% stake in IDBI Bank on Feb 29, 2026, valuing the transaction at ₹53,000 crore ($5.5 billion). The deal will see the government divest its 30.48% holding for ₹26,620 crore and LIC sell 30.24% for ₹26,440 crore, making it the biggest foreign investment in an Indian bank to date.
After a nine‑year saga marked by valuation disputes and a pause in February 2026 when initial bids fell short of the reserve price, the revised offers finally met the committee's threshold.
Shares of IDBI surged 9.07% to ₹90.44 on the BSE after the announcement, while Finance Minister Nirmala Sitharaman hailed the deal as a milestone that will accelerate the bank's growth.
Fairfax must still obtain RBI's fit‑and‑proper clearance, CCI approval, and a potential SEBI waiver before the transaction can close; the promoter stake will be capped at 26% within 15 years, with a five‑year lock‑in.
Employees across the 2,000‑branch network have been told that the management transition will not affect job security, a reassurance echoed by the bank's HR chief, Sunita Rao.
If all clearances arrive on schedule, Fairfax will take over the board, and the sale is slated to conclude by the end of FY27, after which the government will be stripped of its board seat.