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IDBI staff call strike over Fairfax's $5.5 billion bid
CNBC reported Sunday that IDBI Bank employees called a two-day strike against Fairfax Financial Holdings' $5.5 billion bid for a majority stake, with India's opposition backing the unions and the finance ministry defending the sale.
Employees of Indian state-owned IDBI Bank called a two-day nationwide strike against a proposed $5.5 billion sale of a majority stake to Canada's Fairfax Financial Holdings, CNBC reported Sunday1.
The United Forum of IDBI Officers and Employees said it had grave concerns about transparency and valuation, and demanded that the government cancel privatization and strengthen the bank while protecting public investment and staff, according to CNBC1.
Fairfax won a bid in October to acquire more than 60 percent of IDBI at 81 rupees a share, above an average fair value of 75.99 rupees, CNBC said1. India's government said on Oct. 14 that the deal would be the largest foreign direct investment in the country's financial sector1.
Opposition leader Rahul Gandhi last week backed the unions, saying public banks are tools to build the nation and that selling more than 60 percent conflicts with earlier governments' commitment to keep a 51 percent stake, CNBC reported1.
Finance Minister Nirmala Sitharaman said the bank was handed to the government in poor shape and revived through recapitalization of more than 250 billion rupees ($2.6 billion), and that IDBI is poised for growth with a strategic investor, according to CNBC1.
Businessworld reported Thursday that officials suppressed the valuation so Fairfax's offer would look attractive; the Finance Ministry said the process was double-blind, with bidders not seeing the valuation and valuators not seeing bids, CNBC said1. IDBI shares opened around 79 rupees on Monday, the report said1.
