The government has sought expression of interest from reputed merchant bankers for divesting a 10 per cent stake in iron ore miner NMDC that could fetch about Rs. 5,500 crore to the exchequer.
The government holds an 80 per cent stake in the company and after stake dilution, which is likely next month through offer for sale (OFS) route, it would come down to 70 per cent.
“The government is considering to divest 10 per cent paid-up equity share capital of NMDC out of its shareholding of 80 per cent in the domestic market through offer for sale of shares by promoters through stock exchanges,” it said in a notice.
“Proposals are invited from reputed merchant bankers, either singly or as a consortium, with experience and expertise in public offering/OFS in capital market, to act as merchant bankers/selling brokers and to assist and advise government in the process.”
Against its target of mopping up Rs. 43,425 crore through selling stakes in various PSU firms during the current fiscal year, the government has so far been able to garner Rs. 1,715 crore by selling 5 per cent of its stake in SAIL.
NMDC is the country’s largest iron ore miner. The company had produced 30 million tonnes (MT) of the raw material used in steel-making. The government has recently asked the Navaratna firm to jack up its output capacity to 100 mtpa by 2020-21.
NMDC had reported Rs. 6,420.08 net profit last fiscal year on revenue of Rs. 12,058.20 crore.