IDBI Bank Privatisation: Fairfax To Acquire 60.72% Stake For Rs 52,878 Crore; Who Is Prem Watsa?

A major turning point has come for IDBI Bank, as the Union Cabinet has approved the sale of the bank's 60.72% stake to Fairfax Financial Holdings. The transaction will be worth approximately Rs 52,878 crore and involves the sale of stakes held by the Central Government and the Life Insurance Corporation of India (LIC).

The Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi, cleared the transaction. According to the government, it is going to be the largest foreign direct investment (FDI) in India's financial sector till date once completed.

IDBI Bank Deal: How Much Stake Will Fairfax Acquire?

Under the approved transaction, Fairfax's acquisition vehicle, 10955230 Canada Inc, will purchase a combined 60.72% stake in IDBI Bank from the government and LIC.

The proposed stake sale comprises a 30.48% stake from the Government of India and a 30.24% stake from the Life Insurance Corporation of India. So the total stake sale comes to 60.72%

The transaction is valued at approximately Rs 52,878 crore, with the acquisition price fixed at Rs 81 per share. The sale is expected to generate huge proceeds for both the government and LIC

IDBI Bank Shareholding After the Stake Sale

Once the stake sale is completed, the government and LIC are expected to retain minority stakes in the bank.
The government will have a 15% stake, while LIC will hold 19%. Together, the shareholding will amount to 34%.
The CCEA has also authorised the government to sell its residual 15% stake through the open market.

IDBI Bank Privatisation Timeline

IDBI Bank's privatisation process has been going on for several years here is the timeline for the same as per publicly available data:

May 2017: The RBI placed IDBI Bank under the Prompt Corrective Action (PCA) rule due to concerns over bad loans and its financial health.

January 2019: LIC acquired a controlling stake in the bank, becoming its majority shareholder.

March 2021: The RBI removed IDBI Bank from the PCA framework.

May 2021: The CCEA approved the strategic disinvestment of the government's stake in IDBI Bank.

October 2022: Expressions of interest were invited from prospective bidders.

January 2026: The government invited financial bids as the privatisation process moved forward

February 2026: Fairfax and Emirates NBD were the top reported bidders.

March 2026: The process was paused after bids reportedly fell below the reserve price.

April 2026: The sale process resumed.

October 2026: The CCEA approved the sale of a 60.72% stake in IDBI Bank to Fairfax.

Who Is Prem Watsa, The Man Behind Fairfax Financial Holdings?

Prem Watsa is an Indian-born Canadian businessman and investor who built Fairfax Financial Holdings into a global insurance and investment group. According to publicly available data, Watsa was born in Hyderabad in 1950 and studied chemical engineering at IIT Madras. He moved to Canada in 1972 and later completed an MBA at Western University's Richard Ivey School of Business.

In 1985, Watsa founded Fairfax Financial Holdings and the group has also held investments in businesses across multiple sectors and markets, including India.

Fairfax has a good presence in India through investments in financial services and other businesses. The group acquired a controlling interest in CSB Bank and is a recognised foreign investor in India