Cabinet to consider SAIL divestment on Feb 18
The Cabinet is likely to approve the state-run steel maker SAIL's 20 per cent share sale plan at its meet scheduled for Thursday.business Updated: Feb 14, 2010 13:42 IST
The Cabinet is likely to approve the state-run steel maker SAIL's 20 per cent share sale plan at its meet scheduled for Thursday.
"The matter is to be listed in this week's Cabinet meeting. In all likelihood, it will be considered and approved by the Cabinet when it meets this Thursday (February 18)," a senior government official said.
The share sale is proposed to be done through a two-phased follow-on-public offer (FPO) which will see the government selling 10 per cent of its equity in the firm and the company raising fresh equity in the same proportion.
The first-phase of the FPO, which will happen in the next financial year, will see the government divesting 5 per cent of its equity and SAIL issuing the same quantum of fresh equity. The same exercise would be followed in the second phase.
The first tranche of the selloff process is likely to fetch around Rs 9,000 crore. However, the final amount will depend on the issue price.
The government owns a little over 85 per cent in SAIL and post-FPO its holding will come down to about 69 per cent.
Last week, steel secretary Atul Chaturvedi had said the 20-per cent FPO proposal will be sent to the Cabinet in next 10 days.