Canada's Fairfax Financial Holdings has received approval to acquire a majority stake in India's IDBI Bank, Reuters reports. The Indian cabinet cleared the Toronto-based company's bid, according to the outlet.
Fairfax will take a 60.72% stake in the lender for ₹52,878 crore, or roughly $5.6 billion, Reuters reports. The deal marks the largest foreign direct investment ever made in India's financial sector, according to The Hindu and The Economic Times.
The transaction was announced by the Indian government, Moneycontrol.com reports. Fairfax is buying the stake through an arm of its business, according to The Economic Times.
The scale of the purchase sets it apart from earlier foreign investment in Indian banking. At more than $5.6 billion, the transaction exceeds prior deals in the sector, based on the figures reported by Investing.com India and The Hindu.
IDBI Bank has been state-linked, and the sale transfers majority control to a Canadian buyer. The government's approval clears a key regulatory hurdle, though the reporting available does not detail remaining conditions or a completion timeline.
Fairfax Financial Holdings is a Canadian company, and the acquisition extends its reach into India's banking market. The stake gives it control of a lender operating in one of the world's largest economies.
What to watch next: whether the deal closes as approved and how Fairfax's entry reshapes competition among Indian banks.
