Fairfax to buy 60.72% of IDBI Bank for ₹52,878 crore, with approvals pending

India's Cabinet Committee on Economic Affairs approved on 14 October 2026 the sale of a 60.72% controlling stake in IDBI Bank to Fairfax Financial Holdings for ₹52,878 crore (DT Next gives ₹52,877.07 crore; Business Today gives ₹52,878.08 crore). The buyer is Fairfax's subsidiary 10955230 Canada Inc., which the committee named as the strategic buyer. The government sells 30.48% of the bank and the state-owned Life Insurance Corporation of India (LIC) sells 30.24%.

The cabinet decision is not a completed transfer. As of 16 October 2026, the sale has not closed, and approvals are still pending. The government says that, once completed, the deal will be the largest foreign direct investment in India's financial sector so far.

An ₹81 bid, above the government's valuation

The winning bid is ₹81 a share. Business Today reports that the government's valuation benchmark is ₹75.99 a share, the average of two independent valuations, and that the ₹81 bid is above it. The bid is about 6.6% higher (₹81 ÷ ₹75.99). The government did not use the market price as its main benchmark because the stock was volatile, with a range of ₹118.38 to ₹61.01 during the valuation period, that report says.

None of the reports read states a discount to market. Upstox gives IDBI's NSE close on Wednesday, 14 October, as ₹90.39, and says the approval news came after market hours. Measured against that close, ₹81 is about 10% lower. Outlook Business reports a reserve price of ₹94.42 a share that earlier bids did not reach. The reports do not reconcile that figure with the ₹75.99 valuation.

Approvals and conditions still outstanding

Completion depends on requisite regulatory approvals. Upstox reports that the buyer must pass the Reserve Bank of India's fit-and-proper assessment and present its credentials and a compliance roadmap to the RBI. Swarajya and Upstox name the Competition Commission of India as an approval the deal needs. Swarajya lists SEBI approval for the proposed merger.

Fairfax must also make an open offer to other shareholders. None of the reports read gives the open offer's price, size or timing.

Fairfax already holds about 40% of CSB Bank. Under the restructuring plan, it must either merge CSB Bank into IDBI Bank or exit the holding within two years, with the merger subject to RBI and SEBI approvals.

What the deal means for bank privatisation

The sale ends a process that, according to an Outlook Business timeline, began with RBI corrective action against the bank in 2017. Expressions of interest were invited in October 2022. Bids from Fairfax, led by Prem Watsa, and Dubai-based Emirates NBD came in February 2026. The government paused the process in March because the financial bids fell below the reserve price, then invited revised bids in April.

The government would keep 15% of IDBI Bank after completion and LIC 19%, a combined 34%. Outlook Business reports that LIC must cut its stake to 15% within two years under RBI norms. Business Today reports that the CCEA has delegated powers to an alternative mechanism to sell the government's residual 15% holding through the open market.

Management control passes to Fairfax, and the IDBI name stays the same, Outlook Business reports. Outlook Business reports that the invested capital is locked in for three years under the share purchase agreement, and Upstox reports a five-year lock-in for the promoter.

What happens next

The remaining steps are the RBI fit-and-proper assessment, the Competition Commission review, the SEBI-linked CSB Bank merger, and the open offer. The reports read do not give dates for any of these, and no open offer terms have been published in them.

Arunish Chawla, Secretary of the Department of Investment and Public Asset Management, said the deal will be completed before the end of the current fiscal year (FY27, ending March 2027), after final regulatory clearances, Swarajya and DT Next report. Upstox reports that completion is likely before the end of FY27.