GOVT mentions trader bankers, law firms for managing important sales in LIC, PSBs, other Fin settings

The government has dealt dealers and legal advisers for the sale of minorities in LIC and other financial institutions for the public sector, Ministry of Investment and Public Asset Management (DIPAM) (DIPAM) Secretary Arunish Chawla, said Friday.

“As far as Lic is concerned, we have completed the RFP process. The process for the appointment of commercial bankers and legal advisers is completed,” said Chawla, adding that the trader bankers will work for all financial institutions.

In February, Dipam had invited bids from trader bankers and legal companies to help the government to divest its interest in the public sector and listed financial institutions.

According to the two RFPs (request for proposal) Dipam, the trader bankers and legal advisers, would be empaneled for three years, which could be extended by another year.

“Individual transactions can take place at any time over the next three years,” said Chawla, adding that trader bankers will provide all transactions with regard to financial institutions and banks in the public sector.

Dipam, under the Ministry of Finance, manages government share possession in entities in the public sector. More a large number of banks in the public sector and financial institutions must not yet comply with the minimum 25 percent public shareholder standard as imposed by the Marktregulator SEBI.

The government currently has a 96.5 percent interest in LIC. It had sold 3.5 percent via a first public offer (IPO) in May 2022 at a price band of RS 902-949 per share. Sharing sales made the government around RS 21,000 crore.

The government must discharge another 6.5 percent interest in the life insurer of the public sector to comply with the mandatory requirement of 10 percent public shareholders by 16 May 2027.

Also, five PSU banks must not yet meet the minimum standard for public shareholders.

The government currently has a 98.3 percent interest in Punjab & Sind Bank, 96.4 percent in the Indian overseas bank, 95.4 percent in UCO Bank, 93.1 percent in Central Bank of India and 86.5 percent in Bank or Maharashtra.

It has an 86.36 percent in the IRFC financial institution, 85.44 percent in the insurance company De New India Assurance and 82.40 percent at General Insurance Corporation.