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Business News/ Companies / EC nod sought for appointing valuers in HZL, Balco stake sale
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EC nod sought for appointing valuers in HZL, Balco stake sale

Govt holds 49% stake in Balco and 29.5% in HZL

A file picture of Hindustan Zinc. Photo: MintPremium
A file picture of Hindustan Zinc. Photo: Mint

New Delhi: The disinvestment department has approached the Election Commission (EC) seeking its approval for appointing valuers for government’s residual stake in Hindustan Zinc Ltd (HZL) and Bharat Aluminium Co. Ltd (Balco). “We have written to the Election Commission seeking their nod for floating RFP (request for proposal) for appointment of valuers for HZL, Balco stake sale," a senior official of the department of disinvestment said. “The valuers will take six-eight weeks’ time for valuing the stake. We will then go ahead with appointment of merchant bankers," the official added.

The government holds a 49% stake in Balco and 29.5% in HZL.

The finance ministry has already initiated the process of valuation the two companies.

The government had initially planned to sell the residual stake in these two companies last fiscal. However, in interim budget it postponed the stake sale to the current fiscal.

The government plans to mobilize 15,000 crore from the stake sale in HZL and Balco in the current fiscal.

In January, the cabinet had cleared the stake sale in HZL and Balco through auction route.

During 2001-03, the government had sold majority stakes in the two erstwhile public sector undertakings (PSUs) to the Vedanta Group.

At present, London-listed Vedanta holds a 64.92% stake in HZL and 51% in Balco. In January 2012, Vedanta had proposed an acquisition of the government’s remaining stake in the two erstwhile PSUs for about 17,275 crore. In October 2012, shareholders gave their nod to raise offers for acquiring the remaining the government stake in HZL and Balco by up to 43%, or 24,663 crore.

After the shareholders’ approval, the Vedanta board is now empowered to make an offer of up to 21,636.56 crore for the remaining government stake in HZL.

For Balco, the offer can be up to 3,026.14 crore.

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Published: 04 Apr 2014, 12:07 AM IST
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