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| BHEL rules out FPO, govt may divest stake by open mkt sale |
| Press Trust of India / New Delhi Jul 26, 2009, 16:57 IST |
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State-run power equipment maker Bharat Heavy Electricals (BHEL) has ruled out any possibility of follow-on public offer (FPO) and said the government may divest 10 per cent stake in the company through open market transaction.
However, the company did not specify whether it would be done through bringing in a strategic partner or through open offer in the market for divesting government’s 10 per cent stake that can fetch the government about Rs 11,000 crore at the current market value.
"We don't need to file Draft Red Herring Prospectus to market regulator Sebi, because we are not increasing the size of our paid up capital. The government would offload its stake from 67.72 per cent to 57.72 per cent," BHEL CMD K Ravi Kumar said in an interaction with reporters.
Asked about the time frame to divest government share, Kumar said, "I don’t think that it would be done the in the first tranche, which includes NHPC, OIL and NMDC. It would be done possibly in the second tranche in the next financial year."
"This is my understanding that the government would not divest its stake in BHEL this fiscal. But it is purely their prerogative. However, even if the government decides to do it now, it would take four to six months to convince the trade unions," he added.
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