The group of ministers on disinvestment on Wednesday cleared 9.33 per cent stake sale in MMTC through offer for sale which may fetch the exchequer Rs 300 crore.
“We will divest 9.33 per cent in MMTC tomorrow through OFS route,” Disinvestment Secretary Ravi Mathur told reporters in New Delhi.
He said the base or floor price will be informed to the stock exchanges later in the evening.
MMTC disinvestment would be the first stake sale of the government in the current fiscal. The government targets to raise Rs 40,000 crore from PSU stake sale in 2013-14.
The Empowered Group of Ministers (EGoM) on disinvestment is headed by Finance Minister P Chidambaram.
The government expects to raise Rs 250-300 crore through the stake sale and the base or floor price would be “nowhere near the current market price”.
Shares of MMTC closed at Rs 211.45 a piece on the BSE, up 2.92 per cent over the previous close.
The government currently holds 99.33 per cent stake in MMTC and the stake sale would help the company to meet SEBI’s minimum public shareholding norm.
The stake sale, which was originally slated to take place in March, was deferred on valuation concerns.
Since the company’s audited results are out now and after reviewing the final balance sheet for the last fiscal, the disinvestment department would be able to decide on the base price for the OFS.
“This will help in knowing the real value of the shares of MMTC”, said an official.
In the 2012-13 fiscal, MMTC reported a loss of Rs 70.62 crore, due to 57 per cent decline in total revenues during the period as compared to previous fiscal. The company had reported a profit of Rs 70.72 crore in 2011-12.
The DoD had shortlisted three investment bankers - Avendus, IDBI Capital Market Services and IDFC - to manage the 9.33 crore shares or 9.33 per cent stake sale of the PSU.