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IDBI Bank shares in focus as strategic disinvestment proceeds; SEBI approves LIC reclassification as public shareholder, capping LIC voting rights at 10 percent post-disinvestment.
IDBI Bank Stake Sale
IDBI Bank Share Price: IDBI Bank shares will remain in focus on Monday, August 25, as the bank undergoes strategic disinvestment, approved by the Cabinet Committee on Economic Affairs on May 5, 2021. Following this, the Department of Investment and Public Asset Management (DIPAM) has informed that the Securities and Exchange Board of India (SEBI) has approved the reclassification of the Life Insurance Corporation of India (LIC) as a “public shareholder.”
Post-disinvestment, LIC’s voting rights in IDBI Bank will be capped at 10% of total net effective voting rights. LIC will not have control over the bank, any special rights, or representation on the Board of Directors, nor act as a key managerial person. The letter of offer sent to shareholders will specify LIC’s intention to reclassify its residual stake as public.
LIC is required to reduce its residual shareholding to 15% or below within two years of the transaction closing, as directed by the Reserve Bank of India. IDBI Bank will apply to stock exchanges to formalize LIC’s reclassification after the disinvestment is completed.
The reclassification is contingent on compliance with SEBI’s conditions, including regulation 31A(4) of the Listing Regulations, and may be withdrawn if conditions are not met.
IDBI stands for the Industrial Development Bank of India, established in 1964 to provide industrial development and financial services. Initially a government-owned development finance institution, it was transformed into IDBI Bank in 2004 and later re-categorized as a private sector bank in 2019, with the Life Insurance Corporation of India (LIC) as its parent company.
IDBI Bank shares settled at Rs 94.90 apiece with a fall of 2.75 per cent in the last session.
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Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst…Read More
Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst… Read More
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