The Union Government has revived the stalled process of divesting 12.15 per cent stake in Nalco. The Empowered Group of Ministers is slated to fix the reserve or floor price on March 10.

The Government plans to complete the sell-off exercise to mop up between Rs 1,300 crore and Rs 1,400 crore through the auction route before March-end, merchant banking sources told Business Line.

Sources in the Department of Disinvestment as well as the Ministry of Mines confirmed that teams returned this week after completing pre-bid road shows in the US, UK, Singapore and Hong Kong. Last month, two domestic road shows were held in Mumbai and Chennai.

Road Shows

Sources said Franklin Templeton, Lloyd Baughan Asset Management and Pictet were among 15 institutional investors that participated at the road shows in the US and UK. Nalco’s road shows in the Singapore and Hong Kong circuit attracted some 11 qualified institutional investors, including Nomura Securities.

SBI Capital Markets Ltd, IDFC Capital Ltd and Axis Capital Ltd — the three chosen merchant bankers — are assisting the Government in the sell-off exercise. The proceeds of the sell-off are expected to help the Government in managing its deficits in the current financial year. The Government is rushing to meet the targeted figure of Rs 30,000 crore through disinvestment in State-run companies.

The one-day auction on the National Stock Exchange and Bombay Stock Exchange could be carried out in the last week of March . The Rs-5 face-value Nalco stock is currently ruling at the Rs 44 level.

The proposed disinvestment would bring down the Government holding (87.15 per cent) to 75 per cent and also comply with the relevant SEBI norms. At present, in the public category, Franklin Templeton, LIC and Hindalco Industries hold 2.56 per cent, 3.25 per cent and 1.11 per cent, respectively.

Meanwhile, Durga Shanker Mishra, Joint Secretary, Ministry of Mines joined the Nalco board from February 26 in place of Arun Kumar.

(This article was published on March 2, 2013)
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