Discussions on Neyveli Lignite stake sale Thursday

The central government's department of disinvestment (DoD) has decided to meet the officials of Tamil Nadu government Thursday to discuss the modalities of the state buying five percent stake in Neyveli Lignite Corporation Ltd (NLC), said a top company official.

"The disinvestment department has called a meeting July 11 to discuss with the Tamil Nadu government the five percent divestment of centre's stake in NLC," NLC chairman and managing director B.Surender Mohan told IANS over phone from Neyveli.

Tamil Nadu Chief Minister J. Jayalalithaa had earlier suggested that the state government undertakings are ready to buy the five percent stake through an institutional placement programme (IPP).

The union finance ministry discussed the matter with market regulator SEBI, which was of the view that the proposal could get covered within the guidelines on IPP.

The ministry said discussions with the state government officials, ministry of coal and disinvestment department have to be held to work out the exact divestment mode.

"In the offer document for IPP, the seller can propose the criteria on the basis of which allocation could be made. This can be used to give preference to any set of qualified institutional buyers including state undertakings of Tamil Nadu," the finance ministry had said earlier.

Meanwhile the strike by over 27,000 workers, regular and contractual, belonging to various unions at NLC, continued.

Police arrested hundreds of workers who tried to picket a power plant and later released them.

According to Mohan, the lignite situation is comfortable and the company is generating around 2,300 MW power out of total capacity of 2,490 MW at Neyveli.

He said lignite mining activity is also on to a certain extent.

"The stock situation is comfortable for next 10 days," he remarked.