Sebi nod for IPCL float likely today

Clearance for CMC, IBP, ONGC and Gail issues likely next week

Securities and Exchange Board of India (Sebi) is likely to issue a guidance letter tomorrow to the government to go ahead with the book-built offer for the sale of 33.95 per cent of its residual stake in IPCL.

Similar letters for the other offerings -- CMC (26.25 per cent), IBP (26 per cent), Oil and Natural Gas Corporation (10 per cent) and Gail India (10 per cent) -- are likely to be issued over the next week.

In another significant move, the government has redrawn the time schedule for the six issues "" three residual stake sales, Gail and ONGC issues and the initial public offering of the Dredging Corporation of India.

These will take place ahead of the ONGC and Gail issues. The total amount the government hopes to raise from the six issues is about Rs 12,000 crore to Rs 13,000 crore.

The government had to file again an offer for sale prospectus in place of the Red Herring prospectus filed last month for the issues as there are no guidelines under the Sebi Disclosure and Investor Protection (DIP) Guidelines, 2000 for an existing shareholder offering its holding in a listed company.

The guidelines apply only for an initial public offering or if the equity base of the company is being expanded. Since IBP, IPCL, CMC, ONGC and Gail are all listed companies, they do not come under the ambit of DIP.

According to officials, the lead managers for the issues have said the floats could not sail through in the absence of formal rules. After rounds of brainstorming involving disinvestment ministry officials, the legal advisors and the merchant bankers, it was decided that the government would itself file the sale prospectus purely on a voluntary basis.

Sebi has given its consent to issue guidance letters, which will then be presented to the Registrar of Companies for the market offering. The time schedule charted for these offerings is IPCL and CMC (February 16 - 24), IBP and DCI (February 26 - March 2), ONGC (March 3 - 12) and Gail (March 13-19).