The Union government has chalked out a three-stage plan for disinvesting National Aluminium Company (Nalco).
Out its 87.15 per cent holding in , the aluminium major, the government plans to divest 10 per cent through a domestic issue in the first stage.
The second stage would involve a divestment of 20 per cent through an ADR issue , to be followed by a strategic sale of the remaining 29.15 per cent in the third stage.
This would bring down the government holding to 26 per cent, after factoring a 2 per cent reservation for employees.
Sources in Nalco said that the decision to offload a 29.15 stake to a strategic investor was taken on Friday.
The government invited expressions of interest from merchant bankers with expertise in divestment through capital market offerings (domestic and ADRs), and strategic sales, to act as a global co-ordinator and advisor.
Nalco's divestment assumes significance as the acquisition could give the successful bidder a tremendous leverage to influence aluminium prices in the domestic market.
Domestic players like Hindalco and Sterlite would stand to become the market leader, if they acquire the 29.15 per cent stake.
Nalco, India's second largest primary aluminium producer, owns 2.4 lakh tonne of bauxite reserves at Panchpatmali in Koraput district, Orissa.
The company's 8 lakh tonne per annum aluminium refinery is located at Damanjodi in Koraput. Currently, capacity of its 2.3 lakh tpa aluminium smelter at Angul, Orissa, is undergoing expansion to 3.45 lakh tonne by May. The smelter is equipped with a 720 mw captive thermal power plant.
The aluminium major also has port facilities at Vishakapatnam, Andhra Pradesh, which handle imports of caustic soda and bulk exports of alumina.
The vertically integrated aluminium company is among the lowest cost of producers of primary aluminium in the world, in addition to being a large alumina exporter.
