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Business News/ Companies / News/  Govt sets ball rolling for stake sale in NBCC, HUDCO

New Delhi: The government on Wednesday set the ball rolling for further selling of its stake in NBCC and HUDCO, in addition to an initial public offering (IPO) of the power sector company NEEPCO.

The Department of Investment and Public Asset Management (DIPAM) in the finance ministry has invited separate bids from merchant bankers for the three issues, according to public notices.

The DIPAM has proposed to sell additional 10% stake each in construction major NBCC and housing finance company HUDCO, according to the notices.

The government currently holds 73.75% stake in NBCC and 89.81% in Housing and Urban Development Corporation Limited (HUDCO). The proposal is to dilute the stake through the Offer for Sale (OFS) route. The 25% disinvestment in the North Eastern Electric Power Corporation (NEEPCO), a 100% government owned company, is proposed through the IPO route.

At current price, 10% stake sale in NBCC could fetch the government around 1,300 crore and 1,100 crore in case of HUDCO. The DIPAM has invited separate bids from merchant bankers for the three disinvestments.

In 2017-18, disinvestment of 10.19% stake in HUDCO had yielded 1,207.35 crore to the government. In 2012-13 the government came out with an IPO of National Buildings Construction Corporation Limited (NBCC) and diluted 10% stake.

The government in October 2016 had sold 15% stake through an OFS in NBCC for about 2,200 crore. The government proposes to raise 80,000 crore through disinvestment in the current fiscal. So far it has raised 9,219.91 crore by diluting its stake in Mishra Dhatu Nigam and RITES (both through IPO route) and Bharat 22 ETF (Exchange Trade Fund mechanism).

The government sold 25% stake in Mishra Dhatu Nigam and raised 434.14 crore and 460.51 crore from diluting 12.6% stake in RITES, a railways PSU. The Bharat 22 ETF had fetched 8,325.26 crore to the government. In the last financial year, the government had crossed the 1 trillion disinvestment target.

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Updated: 22 Aug 2018, 06:40 PM IST
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