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Cash rich mineral explorer NMDC and MOIL will buy back 25 per cent of the paid-up shares for about ₹10,000 crore, two-third of which may accrue to the government.
“NMDC and MOIL will buy back 25 per cent of the paid-up capital. A notification in this regard is expected shortly,” a Finance Ministry official said.
The government holds 80 per cent stake each in NMDC and MOIL.
Shares of NMDC closed at ₹91.65, up 1.66 per cent on BSE. MOIL scrip ended at ₹243.10, up 1.42 per cent on the BSE.
The official said the Centre is expecting ₹6,500 crore from the two buy backs after considering the proportion of shares that may be tendered by public and promoters.
The Department of Investment and Public Asset Management (DIPAM), previously known as Department of Disinvestment, has been asking such PSUs to utilise surplus cash in either capex or buy back.
Last month, Nalco had said it would buy back 25 per cent of government equity for over ₹2,835 crore.
This will include buy back of 64.43 crore shares at a price of ₹44 a piece. The government holds 80.93 per cent in Nalco.
As at the end of March 2015, NMDC had a cash balance of ₹18,443 crore, Nalco (₹4,628 crore) and MOIL (₹2,830 crore).
Facing a disinvestment target of ₹56,500 crore for current fiscal, DIPAM has asked cash rich PSUs to buy back shares.
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