After getting a go-ahead from the insurance regulator, LIC is preparing itself to complete the 51 per cent acquisition of debt-ridden IDBI Bank by the end of September, sources said.

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

Besides, the insurance behemoth also intends to make an open offer to minority shareholders of IDBI Bank.

As per Sebi takeover code rules, an acquirer has to give an open offer to the shareholders of the target company on acquiring shares or voting rights of 25 per cent or more.

The board of Insurance Regulatory and Development Authority of India (Irdai), at its meeting held in Hyderabad last month, had permitted LIC to increase its stake from 10.82 per cent to 51 per cent in IDBI Bank.

As per current regulations, an insurance company cannot own more than 15 per cent in any listed financial firm.

LIC has been looking to enter the banking space by acquiring a majority stake in IDBI Bank as the deal is expected to provide business synergies despite the lender's stressed balance sheet.

It could happen through issuance of fresh equity so that the government's stake which is presently at 80.96 per cent would come down below 50 per cent as announced in the Budget.