Monday, October 28, 2013

Coal India stake sale by year-end: Jaiswal

The government on Monday said the five per cent stake sale in State-owned Coal India Limited (CIL) is likely to take place either in November or December.

"It is likely that it (stake sale in Coal India) may happen either in November or December," Coal Minister Sriprakash Jaiswal told reporters in New Delhi.

"You may be aware that Coal India Chairman has gone (overseas) for this purpose only," he added.

To woo foreign investors for Coal India stake sale, the disinvestment department (DoD) has embarked on a roadshow spanning across five nations, including Germany and the U.K.

The roadshow began last week amid threats by workers of the State-owned firm to go on strike in December against the government move to divest its stake further.

The Minister also said that though the production of CIL has been hit in the current month on account of Cyclone Phailin, however, "We are hopeful that (Coal India) will achieve its production target (of 482 million tonnes) for the current fiscal."

Government currently hold 90 per cent stake in CIL. It has already selected seven merchant bankers, including Goldman Sachs, Credit Suisse and SBI Caps, to manage the CIL stake sale which is to take place through the offer for sale route.

The Disinvestment department was originally planning to offload 10 per cent stake in CIL, but faced strong opposition from employees union who threatened to go on strike.

CIL workers' union had in September decided to defer its proposed three-day strike to December 17. Earlier, it was planned from September 23.

CIL got listed on the bourses in 2010 through an initial public offering in which the government raised Rs. 15,199 crore by selling 10 per cent stake.

The company has a cash balance of about Rs. 60,000 crore.

The government plans to garner Rs. 40,000 crore this fiscal by way of disinvestment and CIL's stake sale is expected to be the largest.

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