Fairfax IDBI Bank deal: How Prem Watsa’s India investments could expand

With Fairfax Financial Holdings set to acquire a majority stake in state-owned IDBI Bank, Indian-born Canadian billionaire Prem Watsa’s presence in India’s listed corporate landscape is poised to expand to 10 companies.

Fairfax is no stranger to India, with investments spanning multiple sectors, including financial services, hospitality and commodities. According to Bloomberg data, the Canadian financial services group holds stakes in several listed companies, with many of its investments routed through its Mauritius-based subsidiary, Fairbridge Capital Mauritius.

Thomas Cook (India) accounts for Fairfax’s largest holding, at approximately 65%, followed by a 54.6% stake in Fairchem Organics. Fairfax also owns a little over 34% each in Digitide Solutions, Quess Corp and Bluspring Enterprises. Its stake in 5paisa Capital stood at 32.8% as of September 2026.

The combined market value of Fairfax’s holdings in Indian listed companies stood at approximately ₹15,800 crore as of Wednesday’s close. The proposed acquisition of IDBI Bank, however, represents a substantially larger commitment, with Fairfax willing to pay ₹52,878 crore for a 60.72% stake in the lender.

The proposed transaction is expected to be the largest foreign investment in India’s financial sector to date. The Indian government and Life Insurance Corporation of India are expected to retain a combined stake of approximately 34% in the bank.

IDBI Bank’s market capitalisation stood at ₹97,191 crore as of Wednesday’s close. Its shares ended the session at ₹90.39 on the NSE, after rallying 9% — their biggest single-day gain in four months. The proposed acquisition price of ₹81 represents a discount of approximately 10.4% to the closing price.

The Ministry of Finance said on Wednesday that the fair value had been determined using two methods employed by two professional valuation agencies, which arrived at an average price of ₹75.99 per share.

CSB Bank stake presents a regulatory hurdle

 

The acquisition would significantly expand Fairfax’s presence in India’s banking sector. The group already owns approximately 40% of Thrissur-based CSB Bank, a stake valued at around ₹2,200 crore.

Fairfax will have to either divest its holding in CSB Bank or bring it into compliance with applicable regulations within two years of signing the share purchase agreement for IDBI Bank. Current rules restrict a promoter from exercising controlling ownership in two different commercial banks.

The proposed transaction could follow a path similar to Fairfax’s earlier investment in CSB Bank, when the group reduced its holding in ICICI Lombard General Insurance Company to comply with regulatory requirements before acquiring a stake in the private sector lender.

Fairfax’s other financial services investments include a 27% stake in IIFL Capital Services and a 14% holding in IIFL Finance.

Last year, Japan’s Mitsubishi UFJ Financial Group agreed to acquire a 20% stake in Shriram Finance for just under ₹40,000 crore. Dubai-based Emirates NBD also agreed to acquire nearly 60% of RBL Bank for close to ₹27,000 crore.

At nearly ₹53,000 crore, Fairfax’s proposed investment in IDBI Bank would surpass these transactions in value, underscoring the growing scale of foreign investments in India’s financial sector.