Govt sells its stake in Dredging Corporation to 4 major ports
22 Mar 2019
The government has sold its entire stake in Dredging Corporation of India Ltd to a consortium of four state-owned ports, as it rushes to meet its divestment target for the financial year.
The government sold its 73.44 per cent holding in the company at Rs510 apiece - a premium of 17 per cent over Friday’s close — to a consortium of Vishakhapatnam Port Trust, Paradeep Port Trust, Jawaharlal Nehru Port Trust and Deendayal Port Trust (erstwhile Kandla Port Trust).
The share sale which is expected to rake in Rs1,050 crore for the government, according to analysts, taking it closer to its Rs80,000-crore divestment target for the current fiscal.
Among the consortium of ports that bought government’s stake in Dredging Corp, Vishakapatnam Port Trust bought 19.47 per cent, Paradeep Port Trust bought 18 per cent, Jawaharlal Nehru Port Trust bought 18 per cent and Deendayal Port Trust bought 18 per cent.
The government also got exemption from the open offer mandated by Sebi.
Shares of Dredging Corporation of India settled over 17 per cent higher at Rs445.75 at Wednesday's close. Earlier, Dredging Corporation of India (DCIL) shares hit 20 per cent upper circuit at Rs456.70 on Wednesday, touching the day's high.
The Cabinet Committee on Economic Affairs had, in November, given in-principle approval to sell its entire stake in the company to the four ports.
Stake sale in Dredging Corp is the second strategic sale in a public sector company in the current financial year started April. The government had earlier sold 100 per cent stake in HSCC (India) to NBCC (India) for Rs285 crore.
The government had said the stake sale in Dredging Corp will facilitate linkage of dredging activities with ports and diversification of ports into third-party dredging.