Stake Sale In PSBs, Listed Institutions: Government Invites Bids From Merchant Bankers
The last day for putting in bids by merchant bankers is March 27.
The Union government has invited bids from merchant bankers via the Department of Investment and Public Asset Management as it plans to offload its stake in public sector banks and listed financial institutions.
In her 2021–22 budget speech, Finance Minister Nirmala Sitharaman had announced the government's intention to take up privatisation of two PSBs, besides IDBI Bank.
The request for proposal floated by Dipam states that the merchant bankers would be empanelled for a period of three years, which is extendable by one year.
The chosen merchant bankers would advise the government on the timing and modalities for diluting equity in select PSU banks or listed public financial institutions. The last day for putting in bids by merchant bankers is March 27.
"The Government of India (GOI) intends to empanel BRLMs/MBSBs for a period of three years (further extendable by one year) in the context of dilution of GOI equity in select Public Sector Banks (PSBs), and select listed Public Financial Institutions (PFIs) (as defined under the Companies Act, 2013) using SEBI approved methods in accordance with the extant SEBI/RBI/IRDAI and Stock Exchanges regulations/ guidelines," Dipam said while inviting bids.
Depending upon their capacity to handle capital market transactions, the bidders can apply to empanel with Dipam under two categories — 'A+' for a transaction size of Rs 2,500 crore or more, and 'A' for transaction size of less than Rs 2,500 crore.
Among the empanelled merchant bankers, Dipam may select one or more bankers for a specific transaction, depending on the requirement. The selected bidders would have to conduct market surveys, as well as domestic and international road shows to generate interest among prospective investors.
Their other tasks include arranging meetings with top management, and the domestic and international investors, including institutional and high net worth individuals.
They need to also facilitate communications about the growth potential of the entity and articulate the key marketing themes and positioning of the entity.
All expenses in this regard will be borne by the bankers except the tour and stay expenses of government and officials of the PSB or listed PFI, it said.
(With PTI inputs)
