Shares of IDBI Bank fell more than 7% on Thursday after India's government announced it would sell a 60.7% stake in the state-owned lender to Canada's Fairfax Financial Holdings for over 529 billion rupees ($5.5 billion). Once final approvals are obtained, the Ministry of Finance said the deal will be the largest foreign direct investment in India's financial sector. Fairfax's winning bid of 81 rupees per share was above the government's average fair value of 75.99 rupees, but below IDBI's closing price of 90.39 rupees on Wednesday. Fairfax must pass a 'fit and proper' assessment by the Reserve Bank of India. Finance Minister Nirmala Sitharaman said the government will keep a minority stake, and the sale follows other share sales this year, including a $3.3 billion sale of a 6.5% stake in LIC in August.
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