SAIL gets approval for stake sale

SAIL gets approval for stake sale

Mumbai: The nation’s biggest state-run steel producer, Steel Authority of India Ltd (SAIL), received approval from the department of disinvestment for a 20% stake sale, part of a Central divestment programme.

The company received approval for a public offer equivalent to 10% of existing capital, SAIL said on Friday in a statement to the Bombay Stock Exchange. Another 10% in two stages will be sold from the government’s holding in the company, it said.

The government, which holds almost 86% stake in SAIL, plans to sell shares as it needs funds to cut deficit and invest in infrastructure. Prime Minister Manmohan Singh’s government is implementing a plan to spend $8.95 billion (Rs41,617.5 crore) this fiscal to build networks of roads and telephones, power plants and irrigation facilities.

SAIL is also raising funds for expansion. The company plans to increase capacity by more than two-thirds to 23.46 million tonnes by March 2012.

The company has yet to secure cabinet approval for the share sales, the statement said.