New Delhi: The government on Wednesday decided to exercise green shoe option to divest 3 per cent stake in Indian Overseas Bank (IOB) through offer-for-sale following overwhelming response from investors on the first day of subscription. The OFS of Indian Overseas Bank (IOB) opened for subscription on Wednesday for non-retail investors at a floor price of Rs 34 per share.
"Offer for Sale in Indian Overseas Bank received good response from non-retail investors today.
"Against about 34.66 cr shares on offer, demand was received for more than 41 cr shares. Government has decided to exercise the green shoe option. Retail investors get to bid tomorrow 18th December 2025," Department of Investment and Public Asset Management (DIPAM) Secretary Arunish Chawla said in a post on X.
The government proposed to sell up to 38.51 crore (38,51,31,796) shares or 2 per cent base offer size with an option to additionally sell 19.25 crore (19,25,65,898) shares, representing 1 per cent of the total issued and paid up equity share capital of the bank, IOB had said in a regulatory filing.
The government currently holds 94.61 per cent stake in the Chennai-based bank.
Additionally, 1,50,000 shares (equivalent to 0.001 per cent 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 set out in the OFS guidelines, subject to approval from the competent authority.
Eligible employees may apply for shares up to Rs 5,00,000, 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 per cent.
Capital markets 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 per cent), UCO Bank (91 per cent), and Central Bank of India (89.3 per cent).
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