The Cabinet Committee on Economic Affairs cleared a ₹52,878‑crore restructuring of IDBI Bank on Oct. 14, marking the biggest FDI in Indian banking. Fairfax Financial Holdings Ltd. will acquire the lender at ₹81 per share, a price that far outpaces market chatter.
The government retains a 15% stake while LIC holds 19%, bringing their combined holding to 34% in the restructured entity.
Fairfax owns roughly 40% of CSB Bank, which will be merged with IDBI within two years – a consolidation that will expand the combined balance sheet.
The deal concludes a privatisation process that has drifted since 2017. RBI and SEBI approvals are in place, ensuring regulatory compliance for the transaction.
The approval triggers a mandatory open offer under RBI guidelines; shares are eligible for purchase at ₹81 per share. Investors will monitor how the market values the new capital structure ahead of the next earnings release on Feb. 28.