Mines Min too raises dissent on govt's disinvestment norm

After Coal Minister Sriprakash Jaiswal, Mines Minister B K Handique today raised dissent over the government's 25 per cent public float norm and opposed further disinvestment in National Aluminium Company.

Handique has asked the Finance Ministry to exempt Nalco from a rule that requires all listed companies to have a minimum 25 per cent public holding.

"We are seeking exemption for Nalco from this rule. We are not in favour of any further disinvestment in Nalco. The rule is not a mandatory rule," Handique told reporters here today.

Coal Minister Sriprakash Jaiswal had said yesterday that his Ministry will stick to 10 per cent stake sale in Coal India Ltd and the decision of 25 per cent disinvestment in listed PSUs will not be applicable in case of the state-owned firm.

On Nalco, Handique said the navratna (title given to cash-rich firms) had sufficient funds to meet its requirements and its employees and management were opposed to any such move.

"In Nalco, its employees, management and local MPs are against any further disinvestment. Its hands are full. It is doing big projects. It has the requisite money," Handique said.

This is set to cause further differences in the government as its various ministries seem to be on a collision course with the Finance Ministry on the minimum public float norm for listing.

The government, at present, holds 87.15 per cent equity in Nalco, while the rest has already been made public. Its shares were trading at Rs 434.50, down 1.9 per cent as against the previous close on the Bombay Stock Exchange.

Earlier the Mines Ministry had turned down a request from the Finance Ministry on further dilution of government's equity in the aluminium producer. Handique had made it clear that the company does not need funds for the next two years.

Earlier Orissa Chief Minister Naveen Patnaik had said that his party, the Biju Janata Dal, would oppose any move by the Central Government to disinvest Nalco.

The state-owned company reported a five-fold jump in its net profit to Rs 391.48 crore for the fourth quarter ended March 31, 2010, as against the year-ago period. The company has cash reserves of about Rs 4,300 crore.

As per the disinvestment plans, the Union Government intends to garner as much as Rs 40,000 crore this fiscal by selling some of its equity in PSUs such as SAIL, Coal India, Engineers India and Hindustan Copper.