Coal India seeks shareholders nod for Rs 3,650cr share buyback

State-run miner Coal India has sought shareholders' approval for the buyback of 10.98 crore shares worth Rs 3,650 crore.
The PSU has sought shareholders' approval to the buyback offer through postal ballot.
The country's largest coal miner is also offering e-voting facility as an alternate mode of voting to all members to enable them cast their votes electronically instead of dispatching Postal Ballot Forms.
The board of the company, in which government holds around 79 per cent stake, has approved buyback of 10.89 crore shares at a price of Rs 335 per equity shares payable in cash for an aggregate consideration of Rs 3,650 crore.

Shares of Coal India today closed down by 0.81 per cent at Rs 318.95 on BSE.
Government is pushing for buyback of shares by Central Public Sector Enterprises (CPSEs) as it seeks to generate cash as well as help them push the valuation for any divestment.

Also, the government had plans to divest 10 per cent of its stake in Coal India which met with stiff opposition from workers' unions.
In a filing to the bourses today, Coal India (CIL) said that the buyback shall be up to 25 per cent of the aggregate fully paid up share capital and free reserves of the company as per audited accounts of the company for the financial year ended March 31, 2016.

The filing said that e-voting will start from July 26 and conclude on August 24, 2016.
"The result of postal ballot will be announced on or before August 26, 2016," the filing said.
Though the share buyback will help the government meet its disinvestment target, it will further deplete cash resources of the PSU.
In the last one year, CIL has seen depletion in its cash reserve by 18 per cent or Rs 8,700 crore to Rs 38,300 crore as on March 2016.