The Indian Wire » Business » LIC IPO: Govt picks Deloitte, Edelweiss as pre-IPO transaction advisors
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LIC IPO: Govt picks Deloitte, Edelweiss as pre-IPO transaction advisors

PM Modi

Life Insurance Corporation

The scope of the mandate includes advising the Centre on the modalities of the
IPO and the timing, and arriving at an optimal capital structure.

The scope of the mandate includes advising the Centre on the modalities of the IPO and the timing and arriving at an optimal capital structure.

The government has picked Edelweiss Financial Services Ltd and Deloitte as the two pre-initial public offer (IPO) transaction advisors for the listing of the country’s biggest insurer – Life Insurance Corporation of India (LIC), whose public offer is expected to be the largest ever in the history of the domestic capital markets.

“The scope of work of these two advisers will be to prepare LIC to go for a public listing, including advising the government on various aspects. This will include advising the right for IPO, valuation and structuring of the deal

Edelweiss Financial Services and Deloitte were unavailable for immediate comment.

department of investment and public asset management (Dipam) under the finance ministry issued the request for proposal (RFP) seeking to engage two pre-transaction advisers for partial disinvestment of the government’s LIC stake through an IPO. 

The notification said that it proposed to engage up to two pre-IPO transaction advisors from “reputed professional consulting firms/ investment bankers/ merchant bankers/ financial institutions/ banks, independently (not in the consortium) in order to assist DIPAM in the preliminary processes leading to the IPO of LIC India.”

It added that to qualify as an advisor for the pre-IPO deal, the bidder should have an experience of handling at least one IPO of a minimum size of Rs 5,000 crore between April 1, 2017, and March 31, 2020, or should have managed a capital market transaction of Rs 15,000 crore or more during this period.” As per the request for proposal, the govt currently has 95 per cent stake in the company.

In the Union Budget speech for 2020-21, Finance Minister Nirmala Sitharaman had said, “Listing of companies on stock exchanges disciplines the company and provides access to financial markets and unlocks its value. It also provides an opening for retail investors to participate in the wealth so created. The government is now proposing to sell part of its holdings in LIC in the form of an Initial Public Offer (IPO). “

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