COAL & MINES

Govt raises over 3,200 cr from 2.91 per cent stake sale in Coal India

The government sold nearly 2.91 per cent stake in Coal India (CIL) last week and raised more than 3,200 crore in a subdued stock market. Since April last year, the Centre has pared around 4.82 per cent in the state-owned company, raising about 5,700 crore in this financial year.

Currently, the government’s stake stands at 66.14 per cent. It has to reduce its holding by another 1.14 per cent to bring down its stake to the minimum public holding limit of 35 per cent in listed companies.

Last week, the Centre sold 179.57 million shares in CIL at around 177.9 a piece via its central public sector enterprise exchange traded fund (CPSE ETF) scheme, under which the Department of Investment and Public Asset Management, along with Nippon Life India Asset Management as the asset management company of the scheme, floated its sixth further fund offer.

“This is the third time the government has offloaded its stake in the company to meet its divestment targets,” said a senior CIL executive, who did not wish to be identified.

In July 2019, the Centre had sold 1.7 per cent stake in CIL, raising 2,247 crore from the company via its CPSE-ETF Scheme. This was followed by another 0.21 per cent stake sale on October 10, raising 231 crore through the Bharat ETF Scheme.

The government had raised the minimum public holding limit in listed companies to 35 per cent from 25 per cent in March last year. The Centre’s stake in Coal India at the time was 70.96 per cent. It offered the government room for divestment of additional 5.96 per cent in the company, of which it has already sold 4.82 per cent.

“The government has been reducing its stakes in small chunks in the company over the past two years via its CPSE funds. Since March 2018

Source
ET Energy World
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