Canada-based Fairfax Financial Holdings will acquire a 60.72% stake in IDBI Bank for Rs 52,878 crore, or roughly $5.47 billion. The Cabinet Committee on Economic Affairs approved the deal on Wednesday. It will be the largest single foreign direct investment inflow into India to date.
Fairfax, led by India-origin billionaire Prem Watsa, will pick up 30.48% from the Government of India and 30.24% from LIC. After the transaction, the government’s holding will drop to 15% and LIC’s to 19%, giving the two a combined residual stake of 34%. Finance Minister Sitharaman described the deal as a strategic restructuring, emphasising that both government and LIC remain invested.
The deal values IDBI Bank at Rs 81 per share — about 11% below its Wednesday closing price of Rs 90.40. The government said the price was not based on the stock market but on asset valuation using March 2026 audited accounts. Two independent valuations produced a benchmark of Rs 75.99 per share. Since the winning bid exceeded that, it was deemed reasonable.
IDBI was established as a development financial institution in 1964 and converted into a commercial bank in 2004. It went through years of financial stress, absorbing around Rs 25,000 crore in government capital infusions between 2010 and 2020. Its health has since improved — it reported a net profit of Rs 9,513 crore in 2025-26, and total business stood at Rs 6.27 lakh crore as of September 2026, up 18% year on year. The deal is expected to close by the end of this financial year.
Source: Deccan Herald
