Govt clears 7.64% NFL stake sale;hopes net over Rs 130 cr

Government has given its go ahead for 7.64 percent disinvestment in the National Fertilisers Ltd (NFL), which is expected to fetch around Rs 130 crore to the exchequer.

The Cabinet Committee on Economic Affairs (CCEA) cleared the 7.64 percent or 3.74 crore share proposal at its meeting yesterday.

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Government holds 97.64 per cent stake in the company and the disinvestment is being done to make it complaint with Sebi norms, Finance Minister P Chidambaram said today while briefing on the CCEA decisions.

As per Sebi norms, a public sector listed company should have 10 per cent public float by August 08, 2013.

At the current market price of Rs 34.65 a piece, the stake sale could fetch over Rs 130 crore to the exchequer.

The company's shares were trading at Rs 34.65 a piece on BSE, up 2.21 percent from yesterday's close.

The Department of Disinvestment (DoD) had approached the CCEA for stake sale in the company.

An inter-ministerial panel, headed by Disinvestment Secretary, had cleared NFL stake sale last month.

The paid-up equity capital of the company, as on March 31, 2012, was Rs 490.58 crore.

The stake sale in NFL is part of DoD's effort to meet the minimum 10 percent public shareholding norm as stipulated by market regulator Sebi for PSUs.

The government uses the OFS route, popularly known as auction method, to divest its stake in PSUs that come under top 100 companies in terms of market capitalisation. It has already used the route to sell stake in Oil India, NTPC, NMDC and Hindustan Copper during last fiscal.

The government proposes to raise Rs 40,000 crore by way of disinvestment in the current fiscal.