Dubai State-Owned Emirates NBD Frontrunner for IDBI Bank's Majority Stake

Dubai’s government-owned Emirates NBD has reportedly edged out contenders like Kotak Mahindra Bank and Oaktree Capital in the race to acquire a majority stake in the government-owned IDBI Bank. The divestment process, in which LIC currently holds a majority stake, began in 2022. Earlier this year, a top government official stated that the transaction is expected to conclude by the end of 2025.

According to a new Moneycontrol report, Emirates NBD has offered $6–7 billion in an all-cash deal for a 61% stake in IDBI Bank, to secure majority control. The offer was reportedly made during discussions with the Department of Investment and Public Asset Management (DIPAM) a few weeks ago. The report noted that this bid is significantly higher than those of other contenders.

In 2023, DIPAM announced that it had received multiple expressions of interest for IDBI Bank. It was later reported that Fairfax India Holdings, Kotak Mahindra Bank, Emirates NBD, and US asset management firm Oaktree Capital had likely cleared the Reserve Bank of India’s (RBI) ‘fit and proper’ assessment.

In November 2024, the due diligence phase began, giving prospective bidders access to IDBI Bank’s data room. Formal financial bids were initially expected by Q4 of FY25, with the transaction targeted for completion in the first half of FY26. The report now states that the formal bidding process is likely to open by June or July.

The Indian government holds a 45.48% stake in IDBI Bank, while state-owned Life Insurance Corporation of India (LIC) owns 49.24%. Together, they plan to sell 60.7% of the lender.

Emirates NBD Reached Out to Govt After RBI Nod

Moneycontrol reports that Emirates NBD held discussions with DIPAM officials within days of receiving the RBI’s approval to operate as a wholly-owned subsidiary (WOS) in India.

On May 19, Emirates NBD Bank PJSC received "in-principle" approval from the RBI to establish a wholly-owned subsidiary. This would allow the bank to consolidate its existing branches in Chennai, Gurugram, and Mumbai into a single, locally incorporated entity—subject to meeting regulatory conditions.

The RBI encourages foreign banks to adopt the subsidiary model to ensure they operate under the same regulatory framework as domestic banks. Emirates NBD, which has been active in India since November 2017, is among the few foreign lenders to secure this route.

An official told the news portal that rival bids for IDBI Bank were estimated at $4.5–5.5 billion and not entirely in cash. With IDBI Bank’s balance sheet exceeding Rs 4 lakh crore, the acquisition would offer Emirates NBD a substantial presence in the Indian market.

With a current market capitalisation of Rs 1 lakh crore acquiring a 50–60% stake would cost around Rs 50,000–60,000 crore. This implies a price-to-book (P/B) ratio of over 1.8x—about 40% higher than DIPAM’s original expectations. The valuation also far exceeds the share price levels when bids were first invited in early 2023.