IDBI Bank Stake Sale: KPMG Set To Submit Closing Diligence Report Soon
Global consulting firm KPMG, which is the advisor to the government for the stake sale, is set to complete its closing diligence. According to two people with direct knowledge of the matter, the consultant will likely finish the diligence process in a few weeks and submit its report.
However, considering the timeline for this submission, the IDBI Bank sale process will likely conclude only in the next financial year.
A closing diligence report will give potential bidders a clear idea about the financial position of IDBI Bank. This will allow for their bids to be informed with the correct state of the bank's financial performance.
Bidders will likely get 4-6 weeks to submit a financial bid for IDBI Bank once the closing diligence report is submitted. NDTV Profit had previously reported that final bidders for IDBI Bank included Prem Watsa's Fairfax Financial, Emirates NBD, and Kotak Mahindra Bank.
According to the first of the two people in the know, there is still no clarity on which of the three bidders will submit an offer to buy a controlling stake in the bank. NDTV Profit mailed queries to both IDBI Bank and KPMG.
KPMG declined to comment.
On sale is the government's 45.48% and Life Insurance Corp. of India's 49.24% stake in IDBI Bank.
The sale process has seen considerable delays, owing to muted responses from global buyers. Other issues, such as fit and proper clearance from the Reserve Bank of India, also took considerable time, leading to inordinate delays.
If the government is able to close the IDBI Bank stake sale, it would be fulfilling an announcement it made over eight years ago. In 2016, the late Arun Jaitley had spoken about the privatisation of IDBI Bank through a sale of stake. While technically the privatisation was concluded in 2019, the government had sold a part of its stake to LIC then. A proper handover of IDBI Bank to an external buyer is still pending.
Expressions of interest for a controlling stake in IDBI Bank were received two years ago by the government.
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