Government Cancels Bid For Appointing Asset Valuer For IDBI Bank, Fresh RFP To Be Issued

The government on Tuesday cancelled the bid process for the appointment of an asset valuer for strategic sale-bound IDBI Bank Ltd. on low bidder interest.

A fresh Request For Proposal would be invited soon after a review of some of the bid criteria to enable better interest from bidders.

"It has been decided with the approval of the competent authority to cancel the present RFP and to issue a fresh RFP for selection of an asset valuer for strategic disinvestment of IDBI Bank," DIPAM said in a corrigendum.

"We had only a single bid. A fresh RFP will be issued soon after we review some of the criteria to enable better interest from bidders," a government official said.

The government, along with Life Insurance Corp., is selling nearly 61% stake in IDBI Bank and in January received multiple Expressions of Interest for the same.

Department of Investment and Public Asset Management Secretary Tuhin Kanta Pandey had last week said the IDBI Bank strategic sale transaction is "on course" but the transaction would not be completed in the current fiscal.

"We practically don't think that before March we can conclude it (IDBI Bank stake sale)," Pandey had said.

As part of the strategic sale process, on Sept. 1, DIPAM invited bids for appointing an asset valuer and the last date for submission of bids was Oct. 9. The deadline was later extended till Oct. 30.

The asset valuer was mandated to identify intangibles not on the IDBI Bank balance sheet, like brand name, branch network and value them.

The terms of reference for asset valuers included describing and listing of all the properties and assets, including intangibles such as trademark(s), title to property rights being valued, as provided by the bank.

Valuation of intangibles were required to be indicated separately.

The DIPAM had earlier said the bank has 120 properties in the top seven cities. These include 68 properties in Mumbai, 20 in Pune, nine in Chennai and seven in Ahmedabad. Besides, it has six properties in Kolkata and five each in Delhi and Hyderabad.

The asset properties in the seven cities account for 94% of the total written down value (after accounting for depreciation) of fixed assets of IDBI Bank.

The government and LIC together hold 94.72% stake in IDBI Bank.

Pursuant to the strategic sale transaction, the government will own 15% stake and LIC 19% shareholding in IDBI Bank, taking their total holding to 34%.