New Delhi: The Government has decided to divest up to 3 per cent stake in state-owned Indian Overseas Bank (IOB) through an Offer for Sale (OFS) commencing on Wednesday.
At the current market price, the government would be able to garner about Rs 2,100 crore by offloading up to 3 per cent stake in the bank.
Shares of the IOB closed at Rs 36.57 per unit, down 1.08 percent on the BSE on Tuesday.
The government proposes to sell up to 38.51 crore (38,51,31,796) shares or 2 percent base offer size with an option to additionally sell 19.25 crore (19,25,65,898) shares, representing 1 percent of the total issued and paid up equity share capital of the bank, IOB said in a regulatory filing.
"Offer for Sale in Indian Overseas Bank (IOB) opens tomorrow for Non-Retail investors. Retail investors can bid on Thursday. Government offers to disinvest 2% equity in the bank with an additional 1% as a green shoe option," Department of Investment and Public Asset Management (DIPAM) Secretary Arunish Chawla said in a post on X.
The government currently holds a 94.61 percent stake in the Chennai-based bank.
Additionally, the bank said, 1,50,000 shares of the bank (equivalent to 0.001 percent of the total issued and paid up equity share capital of the Bank) may be offered to eligible employees in accordance with the terms and conditions provided in the OFS Guidelines, subject to approval from the competent authority.
The eligible employees may apply for shares amounting up to Rs 500,000, it added.
This is in line with the Securities Contract (Regulation) Rules issued by the Securities and Exchange Board of India, which mandate that all listed companies, including those in the public sector, must have a minimum public shareholding of 25 percent.
Capital market regulator SEBI has given forbearance to CPSEs and public sector financial institutions till August 2026.
The other three lenders where the government stake exceeds the minimum public shareholding threshold are Punjab & Sind Bank (93.9 percent), UCO Bank (91 percent), and Central Bank of India (89.3 percent).
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