IDBI Bank Shares Soar as Fairfax Financial Emerges as Top Bidder

IDBI Bank Shares Jump 4% as Fairfax Financial Leads the Race

Shares of IDBI Bank saw a significant increase of nearly 4% on December 12, following a report that Toronto-based Fairfax Financial has become the frontrunner to acquire a controlling stake in the Indian lender.

The bank's shares were trading at Rs 98.95 apiece, the highest level in seven sessions, with the stock extending gains for the second consecutive session. Fairfax Financial, founded by Indian-Canadian billionaire Prem Watsa, is considering an all-cash offer that matches IDBI's current market value.

Competitors in the Race

Fairfax Financial is competing with Kotak Mahindra Bank, another strong contender in the race. However, Fairfax's all-cash offer has made it the front-runner. Emirates NBD, which had earlier submitted an expression of interest, is rethinking its participation in the final bidding process after recently acquiring a controlling stake in RBL Bank.

Key Facts

• The Reserve Bank of India (RBI) has assessed both Fairfax Financial and Kotak Mahindra Bank and found them to be 'fit and proper' for submission of a financial bid.
• The Centre and Life Insurance Corporation of India (LIC) plan to jointly offload a 61% stake in the lender, which includes 30.48% held by the government and 30.24% by the insurance firm.
• The IDBI Bank transaction is expected to contribute significantly to the Centre's disinvestment and asset monetisation target of Rs 47,000 crore for the financial year 2025-26.

IDBI Bank shares have gained more than 2% in the past five days and have surged 29% in 2025 so far, with a market capitalization of over Rs 1.06 lakh crore.