The government will keep up to 10 per cent of issue size in the initial public offering (IPO) of Life Insurance Corporation of India (LIC) reserved for the company's policyholders, the Rajya Sabha was informed on Tuesday.
In a written reply to a question on disinvestment of LIC, Minister of State for Finance Anurag Thakur said that the government proposes to sell a part of its holding in LIC by IPO, which will be brought out after necessary legislative changes and regulatory approvals.
"In Finance Bill, 2021-22 it has been proposed to have a reservation on a competitive basis, to an extent of up to 10 per cent of the issue size, in favour of life insurance policyholders of LIC. The government will remain the majority shareholder and will continue to retain management control safeguarding the interest of policyholders," he said.
The government had planned to bring the IPO of LIC in 2020-21, but couldn't do so as adverse market condition because of the coronavirus pandemic affected its plans.
Finance Minister Nirmala Sitharaman in her Budget speech had said, "In 2021-22 we would also bring the IPO of LIC for which I am bringing the requisite amendments in this Session itself."
The government has set a target of garnering Rs 1.75 lakh crore from disinvestment in financial year 2021-22.