With the fiscal deficit breaching 90 per cent of the Budget target in nine months, the Government is all set to move ahead with divestment in ONGC and BHEL within this fiscal. An Empowered Group of Ministers (EGoM) is scheduled to meet on Thursday to take a call on the modus operandi and timing of offloading equity in both companies. A person familiar with the development told Business Line, “The EGoM is likely to consider various options, including offer for sale of shares through stock exchanges, before giving the final timeline.” Divestment of ONGC and BHEL could yield Rs 15,000-17,000 crore. The Securities and Exchange Board of India, in its board meeting on January 3, approved the offer for sale of shares through stock exchanges. It said, “Apart from use for compliance with minimum shareholding requirements, this method can be used by promoters of top 100 companies (based on average market capitalisation) for sale of their stake.” The SEBI has notified the mechanism. In such a system, the Life Insurance Corporation, various public sector banks or fully-owned Government entities or special purpose vehicles may be allowed to bid for shares. Every bid/buy order would be required to be backed by 100 per cent upfront cash margin.
Source: The Hindu Business line
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