The government is expected to fast track the stake sale in steel maker SAIL by using a route that exempts the company from seeking comments on its draft offer from the regulator and exchanges.

The follow-on public offer, which will see the government divesting 10 per cent of its stake and the company issuing fresh equity in the same proportion, may help raise Rs 16,000 crore going by the current market price.

“SAIL disinvestment will be on the fast track basis,” a senior Finance Ministry official told PTI.

He further said the government will this week or by next, invite applications to appoint book running lead managers for managing the offer.

According to Disinvestment Secretary Sumit Bose, SAIL is one of the many public sector companies identified by the government for stake dilution to raise Rs 40,000 crore and arrest the widening fiscal deficit.

The others are — Coal India, Hindustan Copper, Power Grid and Manganese Ore India Limited. Divestment in Satluj Jal Vidyut Nigam Ltd is already complete, while that of Engineers India Ltd is on.

Through SJVNL, the government raised over Rs 1,000 crore, while the EIL issue could fetch nearly Rs 977 crore.

Under the fast track route, a company can proceed with the FPO by filing a copy of prospectus with the RoC or the letter of offer with SEBI and stock exchanges. Such companies are not required to file draft offer document for comments from regulator SEBI and stock exchanges.

The government had cleared a proposal to sell 20 per cent equity in SAIL in April.

The government, at present, holds a little over 85 per cent stake in SAIL and post-FPO, its equity in the company is expected to go down to about 69 per cent.

Steel Minister Virbhadra Singh had recently said that the FPO could generate Rs 16,000 crore.

SAIL’s shares closed at Rs 208.20, up 0.56 per cent on the Bombay Stock Exchange. The government in 2009-10 had raised Rs 25,000 crore through stake sales in Oil India, NMDC, REC and NTPC.

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