Government panel defers decision on SAIL stake sale
12 Jul 2012
The Cabinet Committee on Economic Affairs has deferred a decision on divestment of 10.82 per cent government stake in SAIL as steel minister Beni Prasad Verma was away on an official tour.
A PTI report citing unnamed sources said as the minister was in Tokyo to attend an event to sign an agreement between SAIL and Japan's Kobe Steel, the CCEA decided it would not be in the fitness of things to take a call on the matter. Additionally, steel secretary D R S Chaudhary was also in Tokyo.
The follow-on public offer in SAIL is expected fetch the exchequer around Rs4,000 crore. The report said Verma's absence was the only reason for the cabinet deferring the proposal.
Verma left for Tokyo on 8 July and is scheduled to return today. On 10 July, SAIL and Kobe Steel signed the final agreement in an equal joint venture that would see a 500,000 tonne iron nugget manufacturing plant being set up in West Bengal, at a capital outlay of Rs1,500 crore.
The proposal for divestment of government's stake in SAIL was put up to the CCEA by the Department of Disinvestment (DoD). The government has plans for dilution of 10.82 per cent of its 85.82 per cent stake in the company.
According to the DoD note to the CCEA, the offer for sale route would be taken for the stake dilution in the company, but it did not indicate a specific time-frame for the disinvestment as the "time of the issue will depend on market conditions".
