Aiming to raise a minimum Rs 1,514 crore through sale of 5.82 per cent of its stake in steel major SAIL, government today set the floor price at Rs 63 apiece for the auction of shares starting tomorrow.
The offer price is at a discount of 1.41 per cent over Rs Rs 63.90 -- today's closing price of SAIL on the BSE.
The government is selling 24.03 crore shares in SAIL through auction route, the last stake sale of its disinvestment programme for the current financial year.
The auction, if subscribed fully, would take the proceeds from disinvestment in this fiscal to around Rs 23,800 crore, the highest ever realisation on disinvestment front in a single year. It is, however, a tad less than the revised estimates of Rs 24,000 crore.
In a filing to the BSE, the government said that "the floor price for the offer in terms of SEBI OFS circular shall be Rs 63 per equity share of Steel Authority of India Ltd."
The offer hits the market at a time when the bourses have been on a losing streak for five days. The BSE benchmark Sensex has suffered loss of nearly 800 points in these days amid political uncertainty and particularly weak European trends.
The decision on setting the floor price for the issue saw some unusual moves as a high-powered ministerial panel met for the second time in two days to deliberate on the pricing with the company stock slumping 8 per cent in the past one week.
The Empowered Group of Ministers headed by Finance Minister P Chidambaram is believed to have yesterday decided on the pricing of the issue and a formal announcement was expected after the close of market hours.
But departing from the practice followed in previous disinvestments, the panel met again today apparently perturbed over the volatility in the stock.
Shares of SAIL dipped to four-year low levels before ending at Rs 63.90 on the BSE, down by 1.77 per cent over yesterday's close. The stock has lost more than 30 per cent since March last year.
