BSNL IPO: Raja to meet union today

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The crucial meeting between the Communications and IT Minister, Mr A. Raja, and the BSNL employees union over the PSU's proposed Initial Public Offering has been postponed to Thursday.

The meeting is being seen as a last ditch effort by the Ministry to convince the Union about the IPO. Union leaders, however, said that they will not agree to the IPO under any circumstance.

BSNL has proposed to dilute about 10 per cent stake through the IPO and has the support of the Communication Ministry and the Finance Ministry. While the Government is expected to offer sops to the employees to convince them, the Union leaders said that their stand against the IPO will not change and therefore, the outcome of the meeting is a foregone conclusion.

BSNL officials admitted that it would be difficult to move ahead on the listing plans if the employees union did not agree.

The BSNL employees' union, which has the backing of the Left parties, admitted that the political development at the Centre may have weakened their negotiating powers. But the union is planning direct action, including a strike, if the Government goes ahead with the IPO.

In a bid to get the union's support, BSNL has also offered to use some part of the proceeds from the proposed IPO for ramping up the company's pension fund. Government sources said the company has been asked to prepare for the IPO in order to generate funds for BSNL's aggressive roll-out plans.

The company is in the midst of finalising a tender for 90 million lines worth about $9 billion. In addition, the telecom major has plans to roll out CDMA-based mobile network and a pan-India broadband infrastructure, reports The Hindu Business Line.