'Proposal of CIL buying back shares not under consideration'

There was a proposal to sell 5%shares in CIL through offer for sale route. Govt now holds 90% stake in the company

Government at present is not considering any proposal of Coal India buying back shares from the government, a senior official said here today.

"It is not at present under consideration," Coal Secretary S K Srivastava said replying to a question in this regard.

When asked about the possibility of a special dividend by CIL, he said:    "That route is always there...Within the laws and guidelines, Coal India is willing to give the maximum dividend possible."

Coal India CMD S Narsing Rao when asked to comment on buyback of shares said: "I don't think I can make any public comment on it. It is within the purview of board and let the board take a decision. On September 18, we have the AGM and on the same day we are thinking of having board meeting also."

When asked will the issue come up in the board meeting he said, "I can't say."

Media had reported that the Finance Ministry was pushing CIL to buy back 5%of its shares if the company was not able to proceed with its public issue due to poor market conditions.

There was a proposal to sell 5%shares in Coal India through offer for sale route. The government now holds 90% stake in the company.

The Disinvestment Department had pared a plan to sell 10%stake in CIL to placate employee unions.

The five major trade unions representing workers of Coal India had decided to go on a three-day strike from September 23.

Finance Minister P Chidambaram had earlier tried to assuage the workers unions, saying the disinvestment proceeds from the coal behemoth would be invested in PSU banks.

CIL was listed on bourses in 2010 after the government raised Rs 15,199 crore by selling 10%stake in the country's biggest initial public offering.

The company has a cash balance of about Rs 62,000 crore.