Govt firms plans for Coal India stake sale
Govt to invite bids from bankers, advisers this week; aims to raise $7.4 billion in all stake sales in 2013/14
Mumbai: The Indian government has firmed plans to sell a 10% stake in Coal India Ltd through a share auction and will invite bids this week from bankers and advisers to manage it, two sources involved with the matter said.
India’s Department of Disinvestment (DoD) aims to launch the share sale by August or September, people familiar with the matter said.
At the current share price, the stake would be worth $3.6 billion, although the shares are likely to be offered at some discount to the market price. The Indian government owns 90% of Coal India, the world’s largest coal miner by output.
The sale is crucial to New Delhi’s efforts to raise Rs40,000 crore ($7.4 billion) this fiscal year through sales of stakes in state companies to cut its fiscal deficit.
By comparison, it raised $4.4 billion in 2012/13 from stake sales.
The government’s divestment plans include stakes in top state refiner Indian Oil Corp, power equipment maker Bharat Heavy Electricals Ltd and a follow-on public offer in Engineers India Ltd.
Bankers to manage the Engineers India sale are to be short-listed later this month.
Coal India debuted on the stock markets in 2010 after a record $3.4 billion initial public offering.
On Thursday, Coal India shares closed down 1.1% in a weak Mumbai market.
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