NMDC share sale may raise $4.9 bn

NMDC share sale may raise $4.9 bn

Mumbai: The Indian government is hoping to raise over Rs230 billion ($4.9 billion) from the sale of a stake in iron ore miner National Mineral Development Corp, the Times of India said on Saturday.

The public offering is likely to take place in March 2010, the report said, citing finance ministry sources.

The ministry has decided to adopt an auction method for the sale of shares to institutions and high net-worth individuals, while retail investors will be alloted shares at the floor price fixed before the auction, the paper said.

The Financial Express paper said Morgan Stanley was the lead manager for the issue, along with five other investment bankers.

Earlier this month finance minister Pranab Mukherjee said India will not sell more than a 10 % stake in listed state-run firms at this stage.

Shares in NMDC closed at Rs414.15 on Thursday, down 0.85%.

Since August, the Indian government has raised $1.8 billion by selling shares in NHPC and Oil India, while it has approved the sale of shares in NTPC, Satluj Jal Vidyut Nigam and Rural Electrification Corp.

Other state-run firms in which the government is likely to divest stake are Steel Authority of India, Shipping Corp and Coal India.