INSUBCONTINENT EXCLUSIVE:
NEW DELHI: The Finance Ministry is planning to transfer government shares of 10 PSUs, including MMTC, ITDC, MRPL, Hindustan Copper, to
a fund to meet Sebi's minimum public shareholding norms.
As per the norms, PSUs were mandated to achieve the minimum 25 per cent public
shareholding by August 21, 2017, which was later extended by a year.
With the deadline looming, the ministry is contemplating to shift
government shareholding in the 10 PSUs to 'Special National Investment Fund' (SNIF) to meet the market watchdog's norms as it may not be
possible to sell stake in these companies in the current market conditions.
The proposal, being prepared by the finance ministry, would be
placed before the Union Cabinet for approval soon, sources told PTI.
The 10 PSUs in which government shareholding has to be brought down to
75 per cent also include Coal India, NLC (formerly Neyveli Lignite) , SJVN, State Trading Corporation (STC), Kudremukh Iron Ore Company
(KIOCL) and Madras Fertilisers.
As per the note prepared by the ministry, Alternate Mechanism (AM) for disinvestment would be empowered to
decide on shares of which PSUs could be transferred to SNIF
The AM will help the ministry in taking quick decisions in view of the changing market conditions.
Currently, the ministry is conducting
roadshows for selling stake in Coal India and NLC
Government holds 78.32 per cent stake in CIL and 84.04 per cent in NLC.
In case the ministry is unable to offload shares in these two
companies to 75 per cent, the AM would decide on transferring their shareholding to SNIF, sources said.
In August last, the Cabinet had
approved setting up of an AM comprising finance minister, road transport minister and the concerned administrative minister, to decide on
modalities of stake sale in PSUs.
The government had in 2013 approved setting up of SNIF with the specific objective of meeting the minimum
public shareholding of 10 per cent as was then mandated by the Securities and Exchange Board of India (Sebi).
The Centre had then
transferred 10 per cent of its stake in six sick CPSEs - FACT, Hindustan Photo Films Manufacturing, HMT, Scooters India, Andrew Yule and
Company, and ITI-- to SNIF .
Now, with the August 21 deadline approaching fast, the government is considering to transfer more shares to
meet the 25 per cent public float norm.
SNIF was formed to transfer the number of shares that was required to make six sick companies
compliant with the minimum public shareholding norm without any consideration.
The fund was managed by independent professional fund
managers and was assigned to sell the shares within a period of five years
The funds realised from the stake-sale would be used for funding social sector schemes of the government.
