Home >Companies >News >LIC IPO: Goldman Sachs, JP Morgan, Citigroup in race to manage mega share sale

With government forging ahead with the share sale of Life Insurance Corporation of India (LIC), as many as 16 merchant bankers have shown interest in managing the much-awaited initial public offering.

These bankers will make a presentation before the Department of Investment and Public Asset Management (DIPAM) over the next two days - August 24 and 25, reported news agency PTI. This department under Ministry of Finance is looking after the LIC stake sale process.

Touted to be biggest share sale ever seen in the country, the LIC IPO is crucial to the disinvestment target of the central government, after Covid-19  threw a spanner in the plans last year. The government intends to divest its share in the life insurance giant within this financial year.

Centre has set a disinvestment target of 1.75 lakh crore for financial year 2021-22. So far in the current fiscal, it has raked in 8,368 crore through minority stake sales in PSUs and the sale of SUUTI stake in Axis Bank.

Among the bankers looking to manage the LIC IPO are seven international bankers . They will make presentations before DIPAM on Tuesday, PTI reported citing a circular by the department.

The bankers that will be making presentations tomorrow include BNP Paribas, Citigroup Global Markets India, DSP Merrill Lynch, which is now known as BofA Securities, Goldman Sachs India Securities, HSBC Securities and Capital Markets (India), JP Morgan India, and Nomura Financial Advisory and Securities (India).

DIPAM will see the presentations of nine domestic bankers on Wednesday. These will include Axis Capital Ltd, DAM Capital Advisors, HDFC Bank, ICICI Securities and IIFL Securities. Other bankers making a presentation on the same day will include JM Financial Ltd, Kotak Mahindra Capital, SBI Capital Market, and YES Securities India Ltd.

On July 15, DIPAM had invited applications from merchant bankers interested in managing LIC IPO. The government is planning to appoint up to 10 Book Running Lead Managers (BRLMs) to handle the initial share offering as a team. The last date for submit bids was August 5.

The Cabinet Committee on Economic Affairs (CCEA) had approved the initial public offering proposal of LIC last month. The ministerial panel known as the Alternative Mechanism on Strategic Disinvestment will now decide on the quantum of stake to be divested by the government.

“The potential size of the IPO is expected to be far larger than any precedent in Indian markets," DIPAM had said.

The government had earlier appointed actuarial firm Milliman Advisors LLP India to assess the embedded value of LIC ahead of the initial public offering. Deloitte and SBI Caps have been appointed as pre-IPO transaction advisors.

After the IPO of LIC, about 60 per cent of the insurance business will be with listed companies, Additional Secretary in the Finance Ministry Amit Agarwal had said last week.

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