Public sector lender IDBI Bank Ltd has invited an expression of interest (EoI) for the sale of its entire 5 per cent equity stake in the National Stock Exchange Limited (NSE), as per a public notice issued by the bank.
“This EoI is neither a prospectus nor an offer to the public for the sale of shares. IDBI Bank, a client of IDBI Capital Market Services Ltd, intends to sell the shares,” IDBI said in the public notice. Interested parties are required to submit their EoI by January 20, 2015.
As on September 2014, IDBI held early 2.2 million equity shares of NSE, representing around 5 per cent stake in the bourse.
Last year, IDFC was reportedly divested a portion of its stake in the NSE at a price of Rs 4,200 per share. Considering this price, the 5 per cent stake held by IDBI is expected to be valued at around Rs 1,000 crore.
Other major shareholders of NSE are – Life Insurance Corporation (10.51 per cent), State Bank of India (10.19 per cent), IFCI (5.55 per cent) and IDFC (5.33 per cent).
In June, IFCI announced that it is looking to bring down its equity holding in NSE. However, a Business Standard report said that IFCI has postponed the plans to sell 2.5 per cent stake in the bourse.
The stake sale in NSE is part of divesting non-core assets to raise capital as state-run banks try to fund credit growth and also to boost their capital adequacy ratio to help meet the Basel III norms.
State-run banks in India are estimated to need around $2.4 billion in capital to meet Basel III norms, as per the budget speech in July this year.
(Edited by Joby Puthuparampil Johnson)