IMG starts process for residual stake sale in HZL, Balco

Tags: Companies
Moving ahead with the residual stake sale in HZL and Balco, an inter-ministerial panel has begun the process of valuation of the two companies so as to complete the deals by march-end.

"We are in the process of valuing the two companies. The IMG discussed the issuance of Request For Proposals (RFP) for valuation of HZL and Balco," a senior Finance Ministry official said.

The government holds 49% stake in Balco and 29.5% in Hindustan Zinc Ltd (HZL).

"We are working very hard to make it happen by March," Disinvestment Secretary Ravi Mathur told reporters here.

The government had budgeted to collect Rs 14,000 crore through residual stake sales in private companies this fiscal.

Last month, the Cabinet had cleared the stake sale in HZL through auction route while a decision on Balco is yet to be taken.

During 2001-03, the government had sold majority stakes in the two erstwhile PSUs to the Vedanta group.

At present, London-listed Vedanta holds 64.92% stake in HZL and 51% in Bharat Aluminium Company (Balco).

In January 2012, Vedanta had proposed to acquire government's remaining stake in the two erstwhile PSUs for about Rs 17,275 crore.

Last October, shareholders gave their nod to raise offers for acquiring the remaining government stake in HZL and Balco by up to 43% or Rs 24,663 crore.

After shareholders approval, Vedanta Board is now empowered to make an offer of up to Rs 21,636.56 crore for the remaining government stake in HZL.

For Balco, the offer can be up to Rs 3,026.14 crore.

Earlier this week, Vedanta Chairman Anil Agarwal met Economic Affairs Secretary Arvind Mayaram and discussed the stake sale in two companies.

Agarwal later told reporters that he would bid for the companies if the price offered is lucrative.

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