InvestorQ : Why has Edelweiss withdrawn from the LIC IPO offering?
swati Bakhda made post

Why has Edelweiss withdrawn from the LIC IPO offering?

Dia Deshpande answered.
2 years ago

In a surprising move, Edelweiss Financial Services withdrew from the government process to select advisors for the mega LIC IPO. That was after concerns were raised over the possible conflict of interest. Apparently, Edelweiss wrote to the government and voluntarily opted out due to its existing life insurance JV. It is surprising this was missed out earlier.

LIC dominates the Indian insurance sector and is expected to be the biggest IPO ever in the history of the Indian capital markets. The government owns 95% in LIC and it has total assets in excess of Rs.31 trillion. Edelweiss Financial owns the stake in the life insurance JV and that had caused the conflict. Government is yet to take a view on the way forward.

Of course, the government reserves the right to select only one transaction advisor. It is also not clear whether Edelweiss has dropped out of the pre-IPO stage as it wants to be a part of the BRLMs to the issue. Edelweiss has worked earlier on the ICICI Lombard IPO and the HDFC Life IPO, which qualifies to become an advisor to the IPO.