Fairfax aims to transform IDBI Bank into global financial services powerhouse
“We are of the view that IDBI has the potential to be the finest universal Indian bank with global reach. This would help raise India’s credit-to-GDP ratio and transform the lives of ordinary citizens,” Clarke said.
He, however, said Fairfax, as a matter of policy, does not comment on its ongoing transactions.
Fairfax, led by billionaire investor Prem Watsa, offered Rs 81 per share for acquiring a 60.72 per cent controlling stake in IDBI Bank for Rs 52,878 crore, surpassing the government’s independent valuation benchmark of Rs 75.99 per share, according to sources familiar with the transaction.
The offer price represented a 56 per cent premium over the bank’s regulatory book value of Rs 51.85 per share as of March 31, 2026, excluding revaluation reserves and deferred tax assets.
It was also around 15 per cent higher than the closing market price of Rs 70.38 on May 18, the last trading day before final bids were invited.
The proposed acquisition would give Fairfax management control of IDBI Bank, while the government and Life Insurance Corporation of India (LIC) would retain a combined 34 per cent stake in the lender.
Fairfax plans to expand the bank’s business beyond traditional banking by leveraging its customer base and bringing its interests in Go Digit General Insurance, Go Digit Life Insurance and Fairfax India Holdings’ stake in IIFL Capital Services into the financial services platform.
The proposed integration is expected to strengthen the bank’s presence in insurance, investment banking and wealth management and enable it to compete with established financial services groups such as SBI, ICICI Bank, HDFC Bank and Kotak Mahindra Bank.
The disinvestment process followed a global competitive bidding exercise conducted by the government through its transaction adviser.
All prospective bidders underwent a fit-and-proper assessment by the Reserve Bank of India, followed by detailed due diligence for qualified bidders, sources said.
The policy framework for IDBI Bank’s disinvestment was outlined in the Union Budgets for 2016-17 and 2021-22, while the formal sale process commenced in October 2022.
The lender had remained under the RBI’s Prompt Corrective Action framework from May 2017 to March 2021 following a prolonged period of financial stress and required repeated capital support from the government and LIC.
Clarifying the role of NITI Aayog in the disinvestment, sources said the policy think tank had not recommended the sale of IDBI Bank, as it was a scheduled commercial bank and not a public sector undertaking.
NITI Aayog had only been asked to identify public sector undertakings for disinvestment.
They also rejected allegations of a conflict of interest involving former NITI Aayog CEO Amitabh Kant, stating that he was not part of any government panel that recommended the disinvestment.
Kant left NITI Aayog in 2022 and joined Fairfax in 2025.
