Fairfax plans to fold Indian financial holdings into IDBI Bank

MUMBAI, Oct 15 (Reuters) — Fairfax plans to bring its existing Indian financial investments under IDBI Bank, creating a diversified financial services group, the Canadian investment group said in a statement. India on Tuesday approved the sale of a 60.7% stake in IDBI Bank to Fairfax Financial Holdings in a deal valued at 528.78 ‌billion rupees ($5.56 billion), making it one of the country's largest cross-border banking transactions. As part of the deal, Fairfax plans to transfer its 30.2% stake in IIFL Capital Services and 49% stake in Digit to IDBI Bank, making the lender the holding company for the three businesses. The proposed structure would span banking, insurance, investment banking and wealth management. Digit, founded by Kamesh Goyal, comprises Go Digit General Insurance and Go Digit Life Insurance. IIFL Capital Services, founded by Nirmal Jain and R Venkataraman, runs investment banking and wealth management businesses. Fairfax is in the process of raising its stake in IIFL Capital to 51% through an open offer, according to the company. The restructuring is subject to approvals from the banking and insurance regulators. The proposed combined entity will be led by Rakesh