Government Approves Strategic Disinvestment and Stake Sale of IDBI Bank to Fairfax Financial Holdings Subsidiary
Distilled Policy Brief
- M/s 10955230 Canada Inc. (with its parent entity being M/s Fairfax Financial Holdings Limited) was approved as the strategic buyer for an acquisition purchase price of 52,878.0806181 crore rupees.
🎯 Prelims High-Yield Examination Points
IDBI Bank Limited is a scheduled commercial bank regulated by the Reserve Bank of India (RBI). The strategic disinvestment involves the sale of a 60.72% combined equity stake held by the Government of India (30.48%) and LIC (30.24%) to M/s 10955230 Canada Inc. (parent entity: Fairfax Financial Holdings Limited).
⚖️ Mains Analytical & Syllabus Linkages
Analyze the significance of strategic disinvestment and privatization of public sector banks/financial institutions in India, examining the role of multi-tiered decision-making mechanisms and valuation methodologies like market multiples and asset valuation.
🎯 UPSC Prelims Practice Drill
With reference to the strategic restructuring and disinvestment of IDBI Bank Limited, consider the following statements: 1. The strategic buyer approved for the acquisition of a 60.72% equity stake is M/s 10955230 Canada Inc., whose parent entity is M/s Fairfax Financial Holdings Limited. 2. The 60.72% equity stake being divested consists entirely of the shareholding held exclusively by the Government of India. Which of the statements given above is/are correct?
- [A] 1 only
- [B] 2 only
- [C] Both 1 and 2
- [D] Neither 1 nor 2
▶ Reveal Official Answer & Analytical Explanation
Statement 1 is correct because M/s 10955230 Canada Inc., with its parent entity being M/s Fairfax Financial Holdings Limited, was approved as the strategic buyer for IDBI Bank Limited. Statement 2 is incorrect because the 60.72% equity stake sold includes both the Government of India's 30.48% shareholding and the Life Insurance Corporation of India's (LIC) 30.24% shareholding, not solely the Government of India's stake.
🏛️ Historical Twin PYQ Anchor (2021)
Consider the following statements regarding the "National Clean Air Programme (NCAP)": 1. It is implemented by the Ministry of Environment, Forest and Climate Change. 2. Central Pollution Control Board acts as the sole regulatory executive body.