Govt garners Rs 57.5k cr from sell-offs post DCI stake sale
The government has a stiff target of Rs 80,000 crore from sell-offs for this year
New Delhi: The government's FY19 disinvestment proceeds have reached Rs 57,523.32 crore following its decision to sell its entire stake in the Dredging Corporation of India (DCI) to a consortium of four state-owned ports for
Rs 1,050 crore.
The government sold 73.44 per cent holding in the company at Rs 510 a share –a premium of 17 per cent over Friday's close –to Visakhapatnam Port Trust, Paradeep Port Trust, Jawaharlal Nehru Port Trust and Deendayal Port Trust.
The share sale will fetch the government Rs 1,050 crore, said RBSA Advisors, the adviser for the deal.
The development follows the Union Cabinet in November approving the strategic sale of government stake in DCI to a consortium of four ports.
"The share purchase agreement was executed between GoI (Government of India) and the four ports on March 8, 2019," the shipping ministry said in a statement.
"With...transfer of shares, the management and control of the company has also been transferred to the four Ports," it said.
According to the share purchase agreement, the new management has been appointed by the purchaser subject to the compliance of statutory requirements, it said.
"With...transfer of the shares and management and control, of the company, it is expected that the company will have more operational and financial freedom in decision making which would enable the company to take up and execute more works in an efficient way," it added.
DCI was incorporated as wholly-owned Government of India Undertaking with the primary objective of catering to the dredging requirements of Indian ports.
DCI was initially incorporated as a 100 per cent government-owned company.
The government disinvested 1.44 per cent, 20 per cent, five per cent and subsequently 0.09 per cent (employee offer) of its share holding in the company in the years 1992, 2004, 2015 and 2016 respectively. After these disinvestments, the shareholding of the Centre was at 73.47 per cent.
The government has a stiff target of Rs 80,000 crore from sell-offs for this year.
The market regulator Securities and Exchange Board of India had exempted the deal from a mandatory open offer, said the adviser.
The decision came handy for the government to sell its entire stake in DCI. The move has also helped avert a political backlash in the forthcoming polls if the firm would have been