New Delhi: The Board of state-run lender IFCI will consider a proposal on 6 July to invite preliminary bids for selling at least 26% stake to a strategic investor.
Along with annual results, the board would take up the issue of inviting expression of interests (EoI) from strategic investors, an IFCI official told PTI.
The lender has appointed management consultant Ernst & Young to look for the strategic investor. E&Y has been asked to suggest names of strategic investors and will help IFCI in carrying out modalities related with stake sale.
According to the plan, strategic investors will have to make bids within a month of the memorandum of information being made public. Following this, IFCI will shortlist some investors. These investors will be allowed to do a detailed due diligence and submit a fresh bid indicating the price they are willing to pay for the 26% stake.
Based on the second round of bids, the IFCI board will decide on the new stakeholder.
As a precusor to stake sale, IFCI had in May passed an enabling resolution to increase foreign holding in the company up to 74% of its share capital.
Foreign investors Morgan Stanley (2.5%), Goldman Sachs (3.3%), Citigroup (2.5%) and Deutsche Securities (4.61%) already have equity interest in IFCI.
Eleven financial institutions, domestic and overseas, hold 34.8% in the company as on 31 March, which includes 8.4% and 5.01% held by LIC and IDBI respectively.