State-owned Steel Authority of India has plans to expand its dealer network in the country to widen its reach, the Lok Sabha was informed today.
"... With a view to widen the reach of its steel products, the Steel Authority of India Ltd (SAIL) is in the process of expanding its dealer network extensively," Steel Minister Virbhadra Singh said in a written reply.
The steel major has a dealership network of 2,582 dealers (as on December 1, 2010) which is spread over 630 districts of eastern, northern, western and southern region of the country.
"Appointment of dealers in various districts/blocks is aimed at making steel items of mass consumption available near the consuming points in remote areas at competitive prices," the Minister said.
A few days back, the PSU also invited applications for the appointment of dealers. The last date for the purchase of the application forms for the dealers is 24 December and December 31 is the last date for submission of forms.
As per PSU's dealership policy, dealers are required to stock thermo mechanically treated (TMT) bars, galvanised plain/ galvanised corrugated (GP/GC) sheets and other items required by the common man and sell to customers at prices fixed by the company.
Meanwhile, the steel major hopes to raise Rs 8,000 crore from the first phase of its 20 per cent share sale programme. In the first phase, the government plans to divest 5 per cent of its stake in the company, while the steel giant will issue additional shares equivalent to a 5 per cent stake.
Another 10 per cent stake will be sold under the second phase of the FPO.
The two-phase FPO may help raise a total of Rs 16,000 crore, Steel Minister Virbhadra Singh had said.
At present, the government holds a stake of a little over 85 per cent in SAIL and post-FPO, its equity in the company is expected to go down to about 69 per cent.
SAIL wants to part-fund its Rs 70,000 crore capacity expansion programme with the proceeds from the share sale.