State-run firms meet public float requirement

Govt sold shares in 4 PSUs last week, 5 ailing cos got Sebi relaxation

All public sector undertakings (PSUs) met the 10 per cent minimum public shareholding (MPS) requirement by Thursday, the deadline for doing so. Till about two months ago, the feat looked daunting with as many as 12 PSUs remaining non-compliant. However, by selling shares at sharp discounts and with help from the Securities and Exchange Board of India (Sebi), the government has ensured compliance for all PSUs.

According to sources, Sebi has taken note of compliance with Clause 40A of the listing agreement (MPS norm) by all PSUs and won’t pass any order against these as it did in the case of non-compliant private companies. The Centre sold shares in four companies last week, while it got Sebi’s relaxation for five other ailing PSUs.

Sebi has approved a proposal to transfer the excess government shareholding in Andrew Yule, Scooters India, HMT, State Trading Corporation of India  and Hindustan Photofilms, The Fertilizers and Chemicals Travancore and ITI into a special fund. The transfer of shares in these companies will be irrevocable and would be sold at a later stage, possibly after a revival in their performance. Also, the government will lose voting rights on these shares.

Meanwhile, the Centre sold stakes in National Fertilizers, STC and the India Tourism Development Corporation (ITDC) through the offer for sale (OFS) last week. While, its stake in Neyveli Lignite Corporation was sold to Tamil Nadu government-owned entities through an institutional placement programme. In early July, it had sold stake Hindustan Copper to raise Rs 260 crore. In June, the government had sold its 9 per cent in MMTC at a 70 per cent discount to the market price.