Finmin hikes retail investor quota in OFS to 20%

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Retail investors can now have bigger share in the PSU stake sale with the government deciding to double the quota under the Offer For Sale (OFS) route for them to 20%.

"We have changed the retail investor quota in the Offer for Sale (OFS) route. All future disinvestments will now have 20% quota for small investors," a senior finance ministry official told PTI.

The present retail investor quota in OFS is 10%, while 30% is reserved for them in the Follow on Public Offer (FPO).

"The decision has been taken after consultation with Sebi. The move will increase participation of small investors in the disinvestment programme," the official added.

Under the OFS mechanism, at present a minimum of 25% of the shares offered are reserved for mutual funds and insurance companies.

The government has been using the OFS route for disinvestment of PSUs.

Market regulator Sebi had in January, 2013 permitted the promoters of top 100 companies to use the auction route or OFS route to dilute stake in listed companies. It also permitted OFS in those PSUs which were to meet thei minimum 25% public holding norm.

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