ONGC disinvestment process satisfactory: govt

Terming the ONGC disinvestment process as successful and satisfactory, the government has said that method for dilution of its stake in public sector enterprises will be decided on case by case basis.

"...The disinvestment process of ONGC was successful and satisfactory," Minister of State for Finance SS Palanimanickam informed the Lok Sabha in a written reply on Friday.

The government divested its 4.91% paid-up capital of Oil and Natural Gas Corporation (ONGC) through offer for sale of shares by promoters through the stock exchange mechanism, popularly known as auction method, early this month. It fetched Rs 12,749.5 crore from the disinvestment.

The minister also said that "for disinvestment all options available as per Securities and Exchange Board of India (Sebi) Rules and Regulations will be considered on case by case basis".

Earlier, the option for disinvestment was prospectus based initial public offerings (IPOs) and follow-on public offerings (FPOs). Later, the government also approved auction route for disinvestment.

The government has also approved disinvestment in Steel Authority of India, Hindustan Copper and Bharat Heavy Electricals.

In the current fiscal, while government has already diluted its stake in ONGC and Power Finance Corporation, the IPO of National Building and Construction Corporation (NBCC) has hit the market on March 22.

The disinvestment proceeds are channelised into National Investment Fund (NIA) and income from the fund is used for investment in social sector projects and capital investment in select public sector enterprises to enlarge their capital base. The corpus of the Fund is Rs 1,814.45 crore.

In wake of the global slowdown and a severe drought that could adversely affect the 11th Plan growth performance, government in 2009 decided that disinvestment proceeds during April 2009-March 2012 would be available in full for investment in specific social schemes decided by Planning Commission or Department of Expenditure.

The time period has been expanded by another year to March 2013.

However, the existing corpus of the NIF shall remain untouched and continue to be managed by the Fund Managers, Palanimanickam added.