LIC buys nearly 90% of Indian Oil's shares on offer

State-owned Life Insurance Corp of India (LIC) has purchased nearly 90 percent of Indian Oil shares sold by the government in its Rs 9,379-crore disinvestment. LIC's stake in the state-run oil marketing firm has gone up from 2.52 percent to 11.11 percent following its participation in India Oil Corporation (IOC) offer for sale which happened yesterday. The insurer bought as many as 20.87 crore shares or 8.59 percent of IOC, according to a filing by LIC.

The government had yesterday announced that its biggest disinvestment of the fiscal was subscribed 1.18 times. IOC listed "OFS and Open Market" as the mode of LIC's acquisition done on August 24. The government had offered 24.28 crore shares for sale through the OFS whose floor or minimum bid price was set at Rs 387 apiece.

While overall, the issue was subscribed by 1.18 times the retail investors picked up less than one-fifth of their quota on a day when global meltdown wiped away a massive 1,624 points or nearly 6 percent from the benchmark BSE Sensex. IOC shares dipped to Rs 378 on Monday as against the auction floor price of Rs 387. Disinvestment Secretary Aradhana Johri had termed the sale as highly successful given the market conditions and said with this the government has managed the best-ever first half disinvestment collections in seven years.

Together with three other disinvestments since April, the government has mopped up over Rs 12,600 crore, or a little less than one-fifth of the yearly target of Rs 69,500 crore. The stake sale had managed to get total bids for Rs 11,107 crore for 28.74 crore shares, against offer of 24.28 crore shares. Retail investors, who are offered shares at 5 percent discount, i.e.