NEW DELHI: The Department of Investment and Public Asset Management (Dipam) on Monday invited bids from merchant bankers for helping govt in the planned stake sale in select public sector banks and listed financial institutions.
The request for proposal (RFP) published by Dipam said govt intends to empanel book running lead managers, merchant bankers-cum-selling brokers for a period of three years (further extendable by one year) in the context of dilution of govt’s equity in select public sector banks (PSBs), and listed public financial institutions (PFIs), using Sebi approved methods in accordance with the existing guidelines. The last date for submitting the bids is March 27.
In her 2021-22 Budget speech, finance minister Nirmala Sitharaman had said that govt will take up the privatisation of IDBI, two other state-run banks and one general insurance company. But so far, the progress has been limited.
After presenting her 2025-26 Budget, Sitharaman had said that privatisation will happen at least for those entities which are in the list approved by the Cabinet.
The merchant bankers will advise govt on the timing and the modalities of the transaction. The RFP said that merchant bakers can apply for empanelment for the stake sale under two categories. Category ‘A+’ would be for a transaction size of Rs 2,500 crore or more, and category A for transaction of Rs 1,000 crore.
“The bidders can apply for empanelment with Dipam under two categories, depending upon the capacity of the bidders in handling the capital market transactions,” according to the RFP.
A two-stage selection process will be adopted for empanelment. The first stage will involve pre-qualification and short listing of successful bidders by an Inter-Ministerial Group (IMG) on the basis of bids and in accordance with the provisions of the RFP for empanelment, according to the details published by Dipam.
The RFP said that in the second stage, the eligible bidders would be required to demonstrate their credentials before the IMG through a presentation, covering the areas/criteria listed. The IMG would evaluate the bidders on the criteria mentioned based on their presentation and the proposals received and shortlist them for empanelment.