Steel Min to send SAIL's FPO layout to Cabinet this week
Press Trust of India / New Delhi Mar 09, 2010, 16:51 IST
The Steel Ministry today said it will send the 20-per cent share-sale proposal of the country's largest steel maker SAIL to the Cabinet this week.
"The share-sale proposal of the Steel Authority of India Ltd (SAIL) will be sent to the Cabinet this week. Thereafter, the Cabinet Secretary will take a final call on it," Steel Secretary Atul Chaturvedi told reporters on the sidelines of conference to announce the price band of NMDC FPO.
SAIL's share sale is proposed to take place through a two-phased follow-on-public offer (FPO), which will see the government selling 10 per cent of its equity in the firm and the company raising fresh equity in the same proportion.
"The first phase is expected to happen in 2010-11 and the next in 2011-12, but both would be based on the market conditions," Chaturvedi added.
The government holds a little over 85 per cent equity in SAIL.
The Centre plans to raise the money to part fund its massive social and infrastructure programmes while the steel maker would partly finance its Rs 70,000-crore expansion plan through the share sale proceeds.
"Share sale is expected to fetch Rs 8,000 crore in each phase collectively to the government and the company. Thus, the total proceeds of the FPO could be around 16,000 crore." The final amount would, however, depend on the price government fixes for the FPO.
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