The deal still requires regulatory approvals, including from the Reserve Bank of India (RBI), which must also sign off on Fairfax as the buyer. The U.S. dollar figure varies across reports, from about $5.56 billion to $5.6 billion, so treat it as approximate. Fairfax plans to contribute its stakes in Go Digit's life and general insurance units and IIFL Capital Services into IDBI Bank, creating a combined bank, insurance, investment banking and wealth management platform. Details of how that structure will be documented are not yet public.
The government says invested capital will be locked in for three years. Under RBI norms, LIC must reduce its holding to 15% within two years. IDBI's brand will stay unchanged, and management control will pass to Fairfax. The sale was first announced in 2022, stalled over regulatory and procedural problems, and was shelved in March when bids fell short of the government's price expectations. The government reopened the process with fresh sealed bids, and Fairfax won. Kotak Mahindra Bank and Emirates NBD had also been in the mix. For attorneys, the key items to track are the RBI's approval of the buyer, the approval conditions, and the LIC divestment timeline. The deal is described as India's largest cross-border bank transaction and the biggest foreign investment in its fast-growing financial services sector, and it closes a privatisation effort that ran more than four years.