The Indian government has initiated the process of diluting its equity stake in select Public Sector Banks (PSBs) by inviting bids from merchant bankers. The Department of Investment and Public Asset Management (DIPAM) under the Ministry of Finance has issued a Request for Proposal (RFP) to empanel Book Running Lead Managers (BRLMs) / Merchant Bankers-cum-Selling Brokers (MBSBs) for handling the stake sale through Securities and Exchange Board of India (SEBI)-approved methods.
Key Details of the RFP:
- The empanelment will be for three years, extendable by one year.
- Interested bidders must be SEBI-registered Category-I Merchant Bankers with a valid brokering license.
- The selected bankers will advise, structure, and execute the transactions while ensuring compliance with SEBI, RBI, and other regulatory norms.
- Two categories of empanelment have been outlined based on the transaction size:
- Category A+ for transactions above ₹2,500 crore
- Category A for transactions below ₹2,500 crore
- The empaneled bankers will be required to conduct market surveys, investor roadshows, pricing analysis, and other due diligence activities.
The last date for bid submission is March 27, 2025, with the opening of technical bids scheduled for March 28, 2025. The empaneled bankers will then participate in limited financial bids for specific stake sales.
This move is part of the government’s broader disinvestment strategy to enhance efficiency and competitiveness in the banking sector while raising capital through stake dilution in state-owned financial institutions.
