labels: Markets - general, Mining
Government may sell up to 10 per cent stake in Coal India news
17 June 2009

The coal ministry is working on a proposal to offload up to 10 per cent stake in navaratna public sector undertaking Coal India Ltd, coal minister Sriprakash Jaiswal told a news conference on Wednesday.

He said the ministry is considering plans to offer shares to people whose land was acquired for mining purposes as also to CIL employees. The stake sale could lead to an early listing of the navratna PSU and the country's largest coal producer.

Coal India, which received navratna status in October 2008, has to get listed within three years, ie, latest by October 2011, as per rule.

"We are working on a proposal to disinvest 5-10 per cent stake in Coal India. I have informed the finance minister about it but we have not given it in writing," the minister said after a pre-budget meeting with finance minister Pranab Mukherjee.

"We are working on the disinvestment proposal and (looking at options) if we can give those shares to our (CIL) employees and land holders," he added.

The coal ministry is expected to introduce a bill to amend the Coal Mines Nationalisation Act for divesting stake in Coal India.

Besides, the minister said Coal India plans to invest in sophisticated mining equipment to raise production. The company has targeted an output of 435 million tonnes of coal in the current fiscal.

He said, his ministry has also sought import duty relaxation for mining machinery and equipment.

On Monday, Coal India chairman Partho S Bhattacharyya was reported to have said that the the company has initiated talks with the coal ministry for an initial public offer (IPO).

Bhattacharya also said Coal India was looking at strengthening its relief and rehabilitation policy by offering the company's shares to people from whom it acquires land for mining. He said CIL may also offer shares to employees.


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Government may sell up to 10 per cent stake in Coal India