The government is likely to appoint former RBI deputy governor Usha Thorat and former finance secretary Arun Ramanathan on the board of Oil and Natural Gas Corp (ONGC) to pave the way for the state-owned firm’s share sale.
The oil ministry has short-listed Thorat, Ramanathan and Deepak Nayyar, ex-vice chancellor of Delhi University as independent directors on ONGC’s board, which currently, does not meet the listing requirements of market regulator Securities and Exchange Board of India (Sebi).
“The three names will be sent to a search committee, which will screen the names before they are sent to the Cabinet Committee on Appointments for approval,” said an official privy to the development. “The whole process may take at least a month,” he said, adding ONGC will file papers for the follow-on public offer (FPO) once its meets Sebi’s requirement of an equal number of executive and non-executive or independent directors on its board.
The government plans to sell 5 per cent, or 427.77 million equity shares, through the FPO to raise up to Rs 12,000 crore. The FPO was originally scheduled to hit the market in March. “The timing of the FPO will depend on how aggressively the Department of Disinvestment (DoD) pushes for it. It may happen in June or July,” the official said. ONGC does not meet Sebi’s listing norm of having an equal number of functional and independent directors and the government had previously planned to withdraw both its nominee directors on the board to push the FPO through. However, the move would have led to ONGC losing its coveted Navaratna status.