The Government has cleared a proposal for divesting a portion of its stake in state-owned Bharat Heavy Electricals Ltd (BHEL).
It will disinvest 5 per cent paid-up equity, out of its share holding of 67.72 per cent, through the book building process in the domestic market. The stake sale, cleared by the Cabinet Committee on Economic Affairs on Tuesday, is expected to mop-up over Rs 4,500 crore for the Government, going by the current market price.
Retail investors will be allowed a 5 per cent price discount. Ten per cent of the shares to be offered for sale through the Further Public Offer is to be reserved for BHEL employees, who will get a 5 per cent price discount.
“This is in line with the Government of India's policy of enhancing people's ownership in the CPSEs (central public sector enterprises) and enabling them to share the growth and prosperity of these enterprises,” an official statement said. The paid-up equity capital of the company is Rs 489.52 crore. The Centre has appointed four merchant bankers for the equipment major's public offer.
The proposed share sale is part of Centre's plans to garner Rs 40,000 crore through disinvestment in the current fiscal.