PSU stake sale News

The government last October invited bids from similarly placed central public sector enterprises (CPSEs) for buying out entire 100 percent stake in them, along with management control.

The offer for sale (OFS) opened to institutional investors yesterday, wherein foreign fund houses and domestic institutions bid for 1.84 times the shares on offer.

The Union Cabinet on Thursday gave in-principle approval to the proposal of NITI Aayog for strategic stake sale in over a dozen PSUs, including profit making ones.  

 After 12-year hiatus, government is set to revive strategic sale of state-owned companies with the Cabinet likely to consider shortly the outright sale of stake in over a dozen PSUs including the profit making ones.

After 12-year hiatus, government is set to revive strategic sale of state-owned companies with the Cabinet likely to consider shortly the outright sale of stake in over a dozen PSUs including the profit making ones.

 Government is expected to go ahead with the strategic divestment in public sector units (PSUs) within the next six months besides closing down sick firms that are beyond revival, NITI Aayog Vice Chairman Arvind Panagariya said.

An inter-ministerial meeting of secretaries, on July 5, is likely to shortlist the loss-making and sick government companies for stake sale or closure, from the list of  companies NITI Aayog submitted to the Prime Minister's Office in June.

Rejecting need to dilute stake in private companies through SUUTI route, government has said that it is certain to meet its disinvestment target for the current fiscal through offloading minority interests and strategic sale of state-owned companies.

In contrast, there have been only three occasions in the past when the Sensex has registered a gain on a day of Offer For Sale (OFS) by a PSU.  

 The Union Cabinet on Wednesday approved 10 percent stake sale in Coal India that could fetch up to Rs 20,000 crore to the exchequer.

Government has put the strategic sales of PSUs on the fast track and has begun consultations for putting a framework to outline a process for the same.

The Department of Disinvestment wants that PSU stake sale target for the current fiscal be more than halved to Rs 30,000 crore in view of volatility in the stock markets.

Volatile stock markets may compel government to go slow in diluting PSU stocks in the stock market, said Finance Minister Arun Jaitley

PFC is the second PSU to be divested in the current fiscal under the government's disinvestment programme.

Facing a daunting Rs 69,500-crore PSU stake sale target, the Disinvestment Department has begun tapping new overseas markets like Australia, Japan and Canada to attract their cash-rich pension and sovereign wealth funds.

The government will sell its 10 percent stake in blue-chip Indian Oil Corporation (IOC) and 5 percent in power producer NTPC to mop up about Rs 13,600 crore in this fiscal's first disinvestment approval.

The Union Cabinet on Wednesday approved 5 percent disinvestment in NTPC and 10 percent in Indian Oil Corporation to achieve the current fiscal's disinvestment target of Rs 41,000 crore.

The Finance Ministry is expecting an improvement in the fiscal position in January-March quarter on a likely pick up in tax revenue realisation, receipts from spectrum auction and stake sale of PSUs.

The Finance Ministry has asked the Department of Disinvestment to complete the groundwork for stake sales in state-owned companies soon after the budget to take advantage of the bull phase in the stock market.