The Cabinet Committee on Economic Affairs (CCEA) has cleared sale of about 39 crore equity of NMDC of face value of Rs 1 each through the Offer for Sale (OFS) route, an official release said.
At present, the government holds 90 per cent stake in the National Mineral Development Corporation (NMDC).
As of March 31, 2012, the paid up equity capital of NMDC stood at Rs 396.47 crore.
Post disinvestment through the OFS (auction) method, the government holding in the Navratna entity will come down to 80 per cent.
Shares of the NMDC closed at Rs 184.40 apiece, down 0.81 per cent on the BSE today. At the current market price, the proceedings would fetch around Rs 7,000 crore.
NMDC, under administrative control of the Ministry of Steel, is primarily engaged in the business of iron ore mining.
But it is also expanding its activities towards production of steel and other value added products. It is India's largest producer of iron ore, operating two mining complexes in Chhattisgarh and one in Karnataka.
Although the government had earlier proposed stake sale in NMDC, it postponed the decision because of poor market conditions.
The government plans to raise Rs 30,000 crore from disinvestment during the current financial year. However, it has not been able to come out with any public issue during the first six months of the fiscal.
Due to uncertain market conditions, the government in the last fiscal could raise only Rs 14,000 crore from disinvestment against the target of Rs 40,000 crore. (MORE)
