India’s IDBI Bank falls 7% as government announces $5.5 billion stake sale to Canada's Fairfax

MarketsPublished Thu, Oct 15 20262:11 AM EDTUpdated 29 Min AgoKey PointsFairfax's winning bid offered a price of 81 rupees per share for a 60.7% stake in IDBI Bank.Once approved, Fairfax deal to acquire the majority share in IDBI will become the largest foreign direct investment in India's financial sector.Finance Minister Nirmala Sitharaman addresses the media after the interim budget on February 1, 2024 in New Delhi, India. Hindustan Times | Hindustan Times | Getty ImagesShares of IDBI Bank fell more than 7% Thursday after the Indian government announced a majority stake sale in the state-owned bank to Canadian firm Fairfax Financial Holdings for over 529 billion rupees ($5.5 billion).Once the final approvals are in place, the deal will mark the largest foreign direct investment transaction in India's financial sector, India's Ministry of Finance said in a release on Wednesday."Due to its poor financial health, the [IDBI] Bank required repeated infusion of capital," the ministry said, adding that after a brief recovery, the government decided to sell a 60.7% stake in the bank to a "Strategic Buyer."During the bidding process, the government arrived at an average fair value of IDB...