TN to finalise proposal to buy NLC stake on Monday

The Tamil Nadu government will finalise details of the state government buying a portion of the stake the central government is selling in Neyveli Lignite Corporation, by Monday.

State government officials will meet with officials of the Securities and Exchange Board of India and the Government of India in Mumbai on 15 July to finalise the details of the transaction, chief minister J Jayalalithaa said.

The Government of India at present holds 93.56 per cent stake in NLC and the remaining 6.44 per cent shares are held by others. After a further dilution of equity by 5 per cent, the shareholding of the centre will be 88.56 per cent.

''The ''public sector'' character of the company will not be affected at all as long as the Government of India continues to hold more than 51% of the shareholding in NLC. The fear that such a disinvestment would lead to privatization is, therefore, unfounded and devoid of facts,'' the prime minister pointed out in his letter,'' the prime minister said in his letter.

He also stated that SEBI, which was informed of Tamil Nadu's interest to buy the stake, said there existed a possibility for the State Industrial Development Corporation to participate in an institutional placement programme, possibly with some preference.

The prime minister has asked the TN government to nominate a senior official to give final shape to the modalities of the arrangement and to coordinate with the Department of Disinvestment and SEBI so as to comply with the relevant rules.

Jayalalithaa expects the transaction to help resolve the labour unrest with workers protesting the proposed disinvestment.