CIL stake sale today; government eyes Rs 22,600 cr

January 30, 2015 09:26

In the biggest ever share sale, government will offer Coal India shares at a floor price of Rs 358 a piece on Friday for divestment of up to 10 percent stake in the state-run behemoth for an estimated Rs 22,600 crore, even as trade unions warned of strike against the move.

The floor price was fixed on Thursday at a discount of about 5 percent from the current market price of Coal India (CIL), where the government presently holds nearly 90 percent stake.

In the one-day stake sale, to be conducted today during market hours from 9 am to 3.30 pm, the government will sell 31.58 crore shares or 5 percent stake with an option to sell a further 5 percent stake depending on the demand.

At the floor price, the total 10 percent stake can fetch the government Rs 22,600 crore, although retail investors would get a five percent price discount and 20 percent shares worth over Rs 4,000 crore would be reserved for them.

This would exceed the existing record amount of over Rs 15,000 crore raised through a public offer, which was also by CIL when it had entered the market with its IPO in 2010.

CIL shares were sold at a price of Rs 245 in the IPO, which was oversubscribed by more than 15 times.

The government will have to dilute its stake by further 5 percent at a later stage to meet the capital market norms of maximum 75 percent promoter shareholding in a listed company.

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