Govt extends deadline for bids to manage CIL's 10% stake sale

Government has extended the date by three more weeks for submission of bids by merchant bankers interested in managing the 10 per cent stake sale in Coal India (CIL), which is likely to fetch about Rs 22,450 crore.
The government, which owns 78.65 per cent of Coal India, had on August 12 sought bids from banks by September 2 to manage the share offering.
The Department of Disinvestment (DoD) in a notice today said the last date of submission of bids for engagement of merchant bankers and selling brokers for the disinvestment in CIL through Offer for Sale has been extended by three weeks.

"The proposal can now be submitted latest by 1500 hours on September 23," it added.
Five banks will be selected for the offering, the notice said without giving a timetable for the share sale.
The merchant banker is to advise the government on the timing and the modalities of the OFS as well as ensure best returns from the share sale.

Coal India shares closed about 3 per cent down on BSE at Rs 355.49 apiece today. At the current market price, sale of 63.16 crore shares or 10 per cent stake would fetch a little less than Rs 22,450 crore to the exchequer.

The government missed its divestment target for the last five years.
Against the stiff target of raising Rs 69,500 crore from disinvestment in the current fiscal, the government has so far managed Rs 12,600 crore through sale of shares in four PSUs. The government last raised over Rs 9,300 crore through sale of 10 per cent in Indian Oil Corp (IOC) on August 24.
Of the total disinvestment target, Rs 41,000 crore is expected to come from minority stake sale in PSUs, and another Rs 28,500 crore from strategic stake sale.
CIL was listed on stock exchange on November 4, 2010, and its market value stands at Rs 2,34,621 crore.

Employees of CIL would be eligible to apply for up to Rs 2 lakh worth shares and would be offered a discount of up to 5 per cent on the issue price, the DoD notice said.
Besides Coal India, DoD has also lined up over two dozen PSUs, including ONGC, BHEL, NALCO, NMDC, MMTC and Engineers India for stake sale.