Govt plans to divest 10 % in IOC and 5 % in ONGC

Govt plans to divest 10 % in IOC and 5 % in ONGC

Mumbai: The government is set to divest 10 % of its stake in Indian Oil Corporation (IOC), while 5 % in Oil and Natural Gas Corporation (ONGC) next year, a senior official said on Thursday.

“The government plans to sell 5 % stake in ONGC and 10 % in IOC. We are yet to appoint a banker for IOC’s public offer, but we hope to complete the process in Q1 of FY’12," disinvestment secretary Sumit Bose told reporters on the sidelines of Coal India press conference in Mumbai.

The size of the IOC public offer will be “very big" as the government will divest 10 % of its stake in the oil refiner. It will also have a 10 % fresh issue, Bose said.

The public offer of Coal India is likely to break all previous records in the Indian capital market, union coal minister Sriprakash Jaiswal said.

The government is diluting 10 per cent stake in Coal India through a public offer to raise Rs15,400 crore, making it the biggest-ever IPO in India. The government currently owns 100 % stake in the company.

“Disinvestment means an opportunity for creating wealth and benefit investors," Jaiswal said.

Basu pointed out that the due diligence process was on for the SAIL public offer, and the government has already appointed bankers for the same.

Bose further said disinvestment in many big companies, including Shipping Corporation of India (SCI), Power Grid, Hindustan Copper and Manganese Ore India are expected in the current fiscal.

The Centre last week cleared disinvestment of 10 % of its stake in Shipping Corporation. The disinvestment in this navaratna company is expected to generate about Rs1,300 crore.

The Government’s ownership in SCI will come down to 63.75 % from the current 80.12 % after the share sale.

Aiming to raise Rs40,000 crore through disinvestment this fiscal, the Government has mopped up over Rs1,000 crore by divesting its stake in Satluj Jal Vidyut Nigam and around Rs1,000 crore in Engineers India.