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Finance Minister Nirmala Sitharaman reviews LIC IPO progress - CNBCTV18

Union Finance Minister Nirmala Sitharaman reviewed the progress of the mega Life Insurance Corporation (LIC) initial public offering (IPO) on Friday.

“Union Finance Minister Smt. @nsitharaman reviewed progress of the LIC IPO in New Delhi today in presence of @SecyDIPAM; Secretary @DFS_India and Senior Officials @LICIndiaForever and @FinMinIndia via VC,” the Finance Ministry tweeted.

Earlier in December 2021, Department of Investment and Public Asset Management (DIPAM) Secretary Tuhin Kanta Pandey told CNBC-TV18, the government is trying to launch LIC IPO in the fourth quarter (January-March) of this financial year as planned.

The Cabinet Committee on Economic Affairs (CCEA) had in July given its in-principle approval for the listing of LIC. The government also made about 27 amendments to the Life Insurance Corporation Act, 1956 in order to facilitate the listing of the state-owned behemoth.

According to the amendment, the central government will hold at least 75 percent in LIC for the first five years post the IPO and subsequently hold at least 51 percent at all times after five years of the listing. The authorised share capital of LIC shall be Rs 25,000 crore divided into 2,500 crore shares of Rs 10 each, as per the amended legislation.

Up to 10 percent of the LIC IPO issue size would be reserved for policyholders. In her Budget Speech 2021, Sitharaman had said the IPO of LIC would be launched in the financial year beginning April 1. Currently, the government owns a 100 percent stake in LIC.

The government has appointed 10 merchant bankers including Goldman Sachs (India) Securities, Citigroup Global Markets India, and Nomura Financial Advisory and Securities India to manage the mega initial public offering of the country's largest insurer.

Other selected bankers include SBI Capital Market, JM Financial, Axis Capital, BofA Securities, JP Morgan India, ICICI Securities, and Kotak Mahindra Capital Co Ltd, a circular on the divestment department website said.

Once listed, LIC is likely to become one of the biggest domestic companies by market capitalisation.

(With PTI inputs)

First Published: Jan 08, 2022, 11:10 AM