After some hiccups and a late government intervention, the sale of government's 5 per cent stake in ONGC through auction finally managed to sail through and garner estimated proceeds of over Rs. 12,600 crore to partly meet the disinvestment target for this fiscal.
Finance Minister Pranab Mukherjee termed the stake sale a “great success.”
“Our latest figure [from auction of ONGC shares] is now Rs. 12,666 crore, which comes to 98.3 per cent subscription,” he told reporters late in the night.
Late in the night, BSE and NSE, on whose platforms the auction was conducted, said in a joint statement: “The ONGC offer for sale was completed today [on Thursday] using the secondary market mechanism created by NSE and BSE. The final demand was for 42.04 crore shares, against an offer of 42.77 crore shares.”
The total bid came to 42.07 crore shares, which was estimated to fetch Rs. 12,666 crore, the statement said.
Hiccups
The auction, however, faced some hiccups initially, as at the end of the auction at 3.30 p.m., the final bid tally was only for 29.22 crore shares against 42.77 crore offered for sale at a minimum price of Rs. 290 apiece.
During the day, the bourses updated bids every half-hour, but stopped doing so 10 minutes before the close of the auction.
Hectic parleys were held for more than four hours after the end of the auction and a final tally of the bids remained elusive for some time.
As reports earlier in the day were not encouraging with bids worth only about Rs 8,500 crore, the government appeared to have nudged public sector giants, including LIC, to pitch in with their bids and help the issue sail through.
Keywords: ONGC stake sale, PSU disinvestment, BSE, NSE
Don't allaw ongc to run down so much.you procure maximum at current rate.
The then PM Narasimhma Rao sold off Gold to pay off Interest, now this government is selling our national assets. Everyone knows where this funds will finally end up. This will be abig boost for the Swiss economy.
Why national Assets are sold in such a manner. Can't we have an offer
after sometime. Further asking PSU to buy it out is not exactrly
brilliant.
The govt is basically messing up all PSU's to meet its uncontrolled
expenditure. Why are SBI and LIC forced to buy ONGC shares? In fact,
all PSU banks have raided LIC for capital with preferential shares. So
SBI does not have enough capital and goes to LIC for money. Govt needs
money and so forces SBI to buy ONGC. It just does not add up.
The govt has also proposed a share buyback to siphon off money from
PSU's. Sooner or later, someone will have to bail out LIC and PSU
banks. Who will it be? RBI..
The misuse of the so-called Fiscal Deficit and hence Deficit
Financing shows the anti-India plans of MM Singh.The Western economic
system will not work for India. India is at crossroads. India should
resort to "Surplus Financing". Budgeted expenditure should be LESS Than
Revenue. This is the ONLY hope for India to remain solvent. But Alas! MM
Singh follows the diktats of his Master:-The World Bank,in this and
other polices like SUBSIDIES.
I agree with Vijakumar, on the one hand government has sold the control/liberty price fixing of Petrol, Diesel & its forms to the Oil manufacturing companies as to tax the general public and now on the other hand it is selling to the nation's infrastructure for 12000 to 13000 crores. I wonder what is the billon dollar secret for not desperately bringing the swiss black money and not to touch the political crorepatis who made money by means of influences. Also to wonder what happened to the money looters whom all have been in talk in recent years, all these are wiped in the dark. It's only the general middle&less class people are the toys for the government. Hope we are losing our independence because of some politicians by all means.
It is unfortunate that the government has had to sell a stake in a profit making company, but then again the fiscal deficit has got to be kept in check
However large scale sale of national assets of profit making public sector units is not a god in the long term
The government,if it needs more funds to meet increasing expenditure,
should be taxing the IT industry which is raking in huge profits year after year rather than selling "family jewels" to meet the fund requirement. May be,I am indulging in blasphemy!
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