LIC IPO: GOVT FLOATS FRESH RFP AFTER POOR RESPONSE

The government has floated a new request for proposal (RFP) to appoint a legal advisor to assist in the initial public offering (IPO) of the Life Insurance Corporation of India (LIC) as the first tender failed to receive adequate responses from law firms.

In the revised RFP, the Department of Investment and Public Asset Management (DIPAM) has specified that the time limit for validity of the financial bids shall be three years, implying that the law firm will assist LIC and the government for three years. The previous bid document had stated bidders cannot prescribe any time limit for validity of the financial bid, keeping the timeline of their work open-ended.

The timeline has been introduced to precisely define the scope of the legal advisors’ work.

Law firms will have to submit their bids by September 16. The bids will be opened the next day, and the selected intermediary would be intimated.

Legal advisers are required to submit a proposal in a consortium with an international law firm with similar experience and expertise in public offerings in capital markets. The international firm, with whom domestic law firms would tie up, should have experience in managing Indian capital market transactions as advisers or underwriters.

The selected law firm will have to prepare the Draft Red Herring Prospectus (DRHP), Red Herring Prospectus and the final prospectus for filing with the Securities and Exchange Board of India (Sebi) and the stock exchanges. It will also have to draft responses to queries related to the IPO received from Sebi, exchanges, depositories, Insurance Regulatory and Development Authority of India (IRDAI) until the completion of all activities relating to public offering.

The legal advisor will also be required to review disclosures regarding other ventures promoted or partnered by LIC, and also examine litigation against the insurer and its directors, subsidiary firms, and joint ventures, among others.