National Mineral Development Corporation (NMDC) Ltd, in its letter to Bombay Stock Exchange (BSE), has expressed the Government of India’s desire to divest 8.38 per cent of paid-up equity in the company through follow-on public offer (FPO) by March 2010.
NMDC is India’s biggest iron ore mining company and is the third divestment effort on part of the government, preceded by National Hydro-Power Corporation (NHPC) and Oil India Ltd (OIL). The government had raised around Rs 4,200 crore via earlier two divestments.
“The Government has desired to complete the process of disinvestment of 8.38 per cent of paid-up equity in NMDC Ltd, out of government’s shareholding through further public offer in the domestic market during the current financial year,” the NMDC release to BSE read.
Earlier reports said the government had decided to adopt auction method for the sale of NMDC shares. In this process, the retail investors would be allotted shares at the pre-decided floor price, while foreign institutional investors, high net-worth individuals and other institutional investors would have to bid above the floor price.