The Government is mulling over increasing the quantum of divestment in manganese major MOIL to 20 per cent, a move that would enable both Maharashtra and Madhya Pradesh to get a share of the proceeds.
"The Department of Disinvestment says that the Madhya Pradesh and Maharashtra governments have agreed to sell five per cent stake each in Manganese Ore India Ltd (MOIL), in addition to the Centre's proposal of offloading 10 per cent stake," a person in the know of the development told PTI.
The Centre was earlier considering selling 10 per cent stake in the company.
At present, the Union Government holds 81.57 per cent equity in the mini-ratna entity, while Maharashtra and Madhya Pradesh hold 9.62 per cent and 8.81 per cent stake in the company respectively.
"The disinvestment is to happen through an IPO, possibly in the current fiscal," the source said.
Disinvestment Department Joint Secretary Sidhartha Pradhan had earlier said that disinvestment in MOIL could happen in December.
At present, the company is in the process of amending its Article of Association to pave the way for the share sale.
"Approval for amending the articles would be sought in the board meet scheduled for July 23," the official added. The company was being advised by IDBI on the proposed regulatory changes.
"It will be a long road ahead for MOIL disinvestment. Book Runners-cum-Lead Managers are to be appointed. Shares need to be split. Cabinet approval is to be sought. There are many other things which need to be done, before the company goes for the IPO," the official added.
MOIL, which produces about 1.4 million tonnes of manganese ore every year, is the third steel ministry PSU after NMDC and SAIL to be considered for disinvestment.
At present, MOIL operates 10 mines, six located in the Nagpur and Bhandara districts of Maharashtra and four in Balaghat district of Madhya Pradesh.
MOIL had a net profit of Rs 240 crore in 2009-10. The net worth of the company by the end of the last fiscal stood at Rs 1,587 crore.
The government aims to raise Rs 40,000 crore through disinvestment this fiscal. So far, divestment in the Satluj Jal Vidyut Nigam has fetched the exchequer over Rs 1,000 crore.
The government is likely to sell its stake in 10 PSUs, including Coal India, MMTC, SAIL and Hindustan Copper, this fiscal.
During the last fiscal, it had raised Rs 25,000 crore through stake sale in Oil India, NMDC, REC and NTPC.
