Ahead of the crucial meeting of CIL with the trade union on strike notice, the Coal Ministry has written to the Department of Disinvestment stating that the proposed stake sale in PSU is coming at a time when market conditions are not conducive for the same.
“Recently the Coal Ministry wrote to the Department of Disinvestment (DoD) and opined that the proposed stake sale in the Coal India (CIL) is coming at a time when the market conditions are volatile and the economy is not in good shape”, a source close to the development said.
Coal India (CIL) is scheduled to hold a meeting with its five trade unions this week to persuade them to withdraw their strike notice against the government’s move to divest five per cent stake in the PSU firm through offer for sale route.
The five major trade unions representing the workers of CIL have given a notice to go on a three-day strike from September 23.
The government is likely to clear this week the appointment of legal advisors to manage the disinvestment of CIL.
Goldman Sachs, Credit Suisse, Deutsche Bank and SBI Capital Markets are among seven merchant bankers selected to manage the stake sale in CIL.
The government currently holds 90 per cent stake in the company.
DoD pared a plan to sell 10 per cent stake in CIL to placate employee unions.
Finance Minister P. Chidambaram had earlier tried to assuage the workers unions, saying the disinvestment proceeds from the coal behemoth would be invested in PSU banks.
CIL was listed on the bourses in 2010 after the government raised Rs 15,199 crore by selling 10 per cent stake in the country’s biggest initial public offering. The company has a cash balance of around Rs 62,000 crore.