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The Empowered Group of Ministers (EGoM) will meet again in the next 10 days to discuss the mode and timing of stake sale in ONGC. However, disinvestment of another public sector company, BHEL, was dropped from the agenda at the last minute for Thursday's meeting.
The Petroleum Minister, Mr S. Jaipal Reddy, said, “We have discussed today the implications of the new Securities and Exchange Board of India's guidelines. It seems to be attractive.”
He said the EGoM had yet to take a decision on the mode and timing to be adopted for ONGC, as the Deputy Chairman of the Planning Commission, Mr Montek Singh Ahluwalia, was not present in Thursday's meeting.
Late on Wednesday night, SEBI notified the regulations for offer of share sales by promoters. which say, “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.”
This mechanism, also known as the auction route, is an option other than a follow-on public offer. “We will then take a final call. Both the options are open (follow-on public offer and auction route),” Mr Reddy said.
The Government plans to shed 5 per cent equity or 42.77 crore shares in the oil major. After the dilution, its stake in ONGC will come down to 69.14 per cent from 74.14 per cent. It expects to raise between Rs 10,000 crore and Rs 13,000 crore.
Although the earlier plan was to take a call on stake sale in BHEL, too, but Md. Haleem Khan, the Disinvestment Secretary, said the issue was not taken up as the Heavy Industries Minister, Mr Praful Patel, was not present. It was not clear whether the company's listing has been dropped for now, or if it would be taken up in the next meeting.
The Government has set a disinvestment target of Rs 40,000 crore this year, but has collected just over Rs 1,100 crore from the Power Finance Corporation listing so far.
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