You are here: Home » Companies » News
Business Standard

CCEA gives in-principle nod to demerger, strategic disinvestment of NSP

After the demerger, NSP will become a separate company and the managements of NMDC and NSP will be accountable for their respective operations and financial performance

CCEA | NMDC | Steel Industry

Indivjal Dhasmana  |  New Delhi 

steel, exports
NMDC shares closed up 0.95 per cent at Rs 79.95 on the Bombay Stock Exchange on Wednesday.

The Cabinet Committee on Economic Affairs (CCEA) on Wednesday gave “in-principle” approval to the demerger of Chhattisgarh-based Nagarnar Steel Plant (NSP) from National Minerals Development Corporation (NMDC), and strategic disinvestment of the demerged company by selling the entire government stake to a strategic buyer. The processes of demerger and disinvestment would be initiated together and disinvestment of the demerged company (NSP) is expected to be completed by September 2021. With its approval, the amended an earlier decision taken in October 2016 to disinvest NSP as a unit of After the meeting, Information and Broadcasting Minister said the proposal to demerge NSP into a separate company before its disinvestment will allow to focus on its core activities of mining. Shareholders of will also be shareholders of the demerged company (NSP) in the proportion of their shareholding, Javdekar said. After the demerger, investors will have better visibility of the operations and cash flow of NMDC and NSP, he said. The demerger will also be tax neutral from the point of view of capital gains. NSP is a 3-million tonne per annum (mtpa) integrated steel plant, being set up by NMDC in Chhattisgarh’s Nagarnar at a revised estimated cost of Rs 23,140 crore.

NMDC, so far, has invested Rs 17,186 crore in the project, of which Rs 16,662 crore is from NMDC’s own funds; Rs 524 crore has been raised from the bond markets. NMDC’s stock closed 0.95 per cent up at Rs 79.95 on the BSE on Wednesday.

OTHER CABINET DECISIONS The Cabinet allowed Abu Dhabi National Oil to export oil from a Mangaluru strategic storage, a government minister said, mark­ing a policy shift that could enhance foreign participation as India seeks to expand its storage capacity. India has formerly barred oil exports from strategic storage. The Cabinet chaired by PM Modi approved a special package of Rs 520 crore for J&K and Ladakh under the National Rural Livelihood Mission (NRLM). NRLM aims to enable the rural poor to increase household income through sustainable livelihood enhancements and improved access to financial services. The Union Cabinet chaired by Prime Minister Narendra Modi on Wednesday approved the Strengthening Teaching-Learning and Results for States project under the New Education Policy to support states in strengthening the school education system, Union Minister said. (Agencies)

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Wed, October 14 2020. 19:41 IST