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Steel, finance ministers start talks on SAIL stake sale

Steel, finance ministers start talks on SAIL stake sale
PTI
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First Published: Mon, Sep 28 2009. 01 18 PM IST
Updated: Mon, Sep 28 2009. 01 18 PM IST
New Delhi: With the stock market heading north, the Steel Ministry has approached the ministry of finance to initiate the disinvestment process in SAIL along with its proposed public offering.
“Discussions are on between us and the Ministry of Finance on the matter of disinvestment in SAIL. Its public offer is also being looked at,” Steel Secretary P K Rastogi said.
He, however, declined to elaborate saying discussions are at the preliminary stage.
The quantum of government’s holding to be sold through disinvestment and fresh equity to be raised through the public offering could not be ascertained.
The equity sale could go along with the proposed public issue of the country’s largest steel maker. Official sources said the measures could be taken in a way that government’s holding in the firm does not fall below 75%.
The government currently owns 85.82% stake in SAIL. Besides, about 4.59% is with the Life Insurance Corporation and the rest is with the public.
SAIL shares were closed at Rs169.20 on Friday last week.
The steel major has already submitted the proposal for its public offer to the ministry and is awaiting approval for the proposed issue, proceeds of which would part finance its Rs 70,000-crore expansion project.
SAIL has a capital expenditure programme of about Rs10,300 crore for the current fiscal.
The company is in the process of expanding its annual production capacity to about 23 million tonnes by 2012 from the present 14 million tonnes.
SAIL has also expressed confidence that the dispute over renewal of four mines in Chiria would be resolved soon, with the Jharkhand government acknowledging mining rights in SAIL’s favour.
“We are making progress on Chiria issue. SAIL is much more confident of getting the Chiria issue resolved... Jharkhand government has acknowledged that Chiria mines rights belong to SAIL,” SAIL chairman S.K. Roongta had said recently.
Of the 10 mining leases, SAIL is facing dispute over renewal of four mines in the Chiria region.
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First Published: Mon, Sep 28 2009. 01 18 PM IST