Moneycontrol
Last Updated : Jul 13, 2018 01:37 PM IST | Source: Moneycontrol.com

IDBI Bank shares drop 7% after employees threaten 6-day strike next week to protest stake sale to LIC

The public sector lender on Thursday received notice from a section of officers that they proposed to go on strike from July 16 to July 21, 2018.

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IDBI Bank share price fell more than 7 percent intraday on Friday after a section of officers proposed to go on a strike next week.

The public sector lender on Thursday received notice from a section of officers that they proposed to go on strike from July 16 to July 21, 2018.

The six-day strike is in protest against the proposed acquisition of the state-owned lender by insurance behemoth LIC and wage-related issues, among others.

Wage revision for IDBI Bank's employees is pending since November 2012. They had threatened to go on strike last year but later it was called off following an assurance from the management.

In a representation to Union Finance Minister Arun Jaitley, the All India IDBI Officers' Association had opposed the up to 51 percent sale of the bank's equity to LIC, saying the move tantamounts to privatisation of the bank.

"The subjective move of the Government of India tantamount to reneging on the solemn assurance given by the then Finance Minister of the NDA Government on the floor of Parliament on December 8, 2003 that post conversion, the government shall at all times, maintain not less than 51 per cent of the issued capital of the Company," said association's General Secretary Vithal Koteswara Rao.

He had cautioned that in the unfortunate eventuality of the government failing to review its stand in the matter, the officers and employees of IDBI Bank will be left with no other option but to take recourse to organizational forms of action.

Meanwhile, source said that after getting a go-ahead from the insurance regulator Irdai, LIC is preparing itself to complete the 51 percent acquisition of debt-ridden IDBI Bank by the end of September.

At present, Life Insurance Corporation (LIC) of India is doing the due diligence of IDBI Bank, its assets, debt position and fixed assets.

Sources told CNBC-TV18 that LIC board is likely to approve increasing stake in IDBI Bank to 51 percent on July 16.

At 13:22 hours IST, the stock price was quoting at Rs 54.60, down Rs 1.70, or 3.02 percent on the BSE. (With inputs from PTI)
First Published on Jul 13, 2018 01:37 pm
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