LIC IPO: Govt Screens 11 Companies For Role Of Transaction Advisor

Eleven firms are in race to play ‘transaction advisor’ to the government for the proposed initial public offering (IPO) of Life Insurance Corporation of India (LIC). These include Axis Capital, Citibank, CLSA, Deloitte India and SBI Capital markets. All the 11 firms were make a presentation through video conferencing to the government on Friday following which the financial bids will be opened.

LIC’s IPO is expected to be by far the biggest in the domestic capital markets. Some have pegged the issue size to be about Rs 1 trillion.

The insurance behemonth’s IPO is crticial to achieve this financial year’s ambitious disinvestment target of Rs 2.1 trillion.

The centre is expected to appointed two transaction advisors for the IPO.

“The advisor would ensure preparatory aspects of the proposed IPO and would, advise and assist the government on modalities of IPO and the timing; structuring the transaction; organizing non-deal roadshows, suggesting measures to fetch optimum value; positioning of the minority sale, among others,” the government has said in the request-for-proposal.

Industry observers said the names of some of the marquee investment banks were missing from the list of 11 candidates. They said probably more firms are looking to act as merchant bankers to the IPO rather than pre-IPO transaction advisor.

The government has clarified that the advisor will be eligible to be appointed as the merchant banker.