Govt to divest up to 10% in Coal India; OFS to open Jan 30
The government on Wednesday announced plans to sell up to 31.57 crore shares (10 percent equity) in Coal India . It plans to divest 5 percent stake in the company via share sale and the remaining 5 percent through the green-shoe option. The OFS will open on January 30. The government will declare floor price for Coal India OFS on January 29. A ministerial panel will meet tomorrow for the same and also to decide on retail discount to be offered. “CIL proposes to sell 31,58,18,220 equity shares of face value of Rs 10 each with an option to sell an additional upto 31,58,18,220 equity shares of face value of Rs 10 each,” it said in a statement to the exchanges. Twenty percent of the size of the sale shall be reserved for retail investors. BSE and NSE will decide the quantity of shares eligible to be considered in the retail category, based upon the floor price, according to the release. The government currently holds 89.65 percent stake in CIL. As per the minimum shareholding norms for listed companies, the government needs to lower its stake in the state-run behemoth to 75 percent. Sources say JM Financial, Kotak Mahindra Capital, SBI Capital, Credit Suisse, Goldman Sachs, Deutsche Bank and Bank of America Merill Lynch are the likely bankers for the OFS. With just a 5 percent stake sale, the government is likely to raise around Rs 12,000 crore. The Narendra Modi government has a near impossible task of raising Rs 58,425 crore (target), of which Rs 43,000 crore is expected to come through stake sale in public sector undertakings in 2014-15. It has managed to raise just Rs 1,700 crore from divesting its 5 percent stake in Steel Authority of India (SAIL). Union minister Piyush Goyal had earlier said that the employees of Coal India will also be given the opportunity to participate in the disinvestment.
[ Source :- moneycontrol.com ]