Canadian investor Prem Watsa’s Fairfax Financial Holdings is set to acquire a 60.72% controlling stake in IDBI Bank, following approval from the Indian government for the strategic sale. The transaction, valued at approximately ₹52,878 crore ($5.56 billion), is expected to rank among the largest foreign investment deals in India’s financial sector.
Watsa, an Indian-origin Canadian billionaire, founded Fairfax Financial Holdings and is known for his long-term investment strategy, which has earned him comparisons with American investor Warren Buffett.
Prem Watsa is the founder, chairman and chief executive officer of Fairfax Financial Holdings. He was born in Hyderabad on August 5, 1950. He studied chemical engineering at the Indian Institute of Technology Madras and subsequently earned an MBA from the University of Western Ontario in Canada.
Watsa founded Fairfax in 1985. The company operates in insurance, investments and financial services. He is known for investing in businesses with long-term potential and adopting a patient approach to investment, drawing comparisons with Warren Buffett.
Watsa also has longstanding ties to India. He was awarded the Padma Shri in 2020 for his investments in Indian businesses and his social contributions.
The Cabinet Committee on Economic Affairs (CCEA) approved the strategic sale of IDBI Bank on October 14, 2026. Under the proposed transaction, the central government will sell its 30.48% stake, while the Life Insurance Corporation of India (LIC) will divest its 30.24% holding. The combined 60.72% stake will be acquired by a Fairfax affiliate.
The transaction is valued at approximately ₹52,878.08 crore, with a price of ₹81 per share. Following the sale, the government will retain a 15% stake in IDBI Bank, while LIC will retain 19%. Their combined remaining holding will amount to 34%.
Fairfax’s bid of ₹81 per share is higher than the prescribed valuation of ₹75.99 per share. However, cabinet approval does not mean that all acquisition procedures have been completed. The transaction remains subject to regulatory approvals and other required formalities. It is expected to be completed by March 2027.
IDBI Bank’s financial position has improved over the past several years. According to government data, the bank’s gross non-performing asset (NPA) ratio declined from 31.78% in September 2018 to 2.32% by March 2026.
The reduction in the gross NPA ratio reflects a decline in the bank’s non-performing assets over the period. For Watsa, the investment provides an opportunity to expand Fairfax’s presence in the Indian banking market. The bank’s existing customer base, branch network and financial services infrastructure could provide avenues for business expansion.
Fairfax’s strategy may extend beyond acquiring a stake in IDBI Bank. The company is exploring the possibility of bringing its Indian financial services businesses onto a common platform.
According to reports, the proposed plan could involve integrating the assets or businesses of Digit Life Insurance, Digit General Insurance and IIFL Capital with IDBI Bank. Any such move would remain subject to approvals from the relevant regulators and compliance with applicable rules.
If implemented, the plan could create an opportunity to offer banking, insurance, investment and wealth management services within a broader financial services framework.
