Rashtriya Chemicals stake sale gets govt $57 million

REUTERS - The government raised $56.84 million by selling some of its shares in state-run Rashtriya Chemicals and Fertilizers Ltd (RCF) on Friday, as part of a divestment drive to help rein in the budget deficit.

The RCF share auction was subscribed 1.3 times the number of shares on offer, with bids at a weighted average price of 45.02 rupees against the government's minimum offer price of 45 rupees a share, stock exchange data showed.

New Delhi was selling 12.5 percent stake, or about 69 million shares, in RCF to reduce its stake to 80 percent.

The RCF share sale is part of the government's divestment drive to help restrict fiscal deficit to 5.2 percent in the fiscal year ending March 31 and fend off the threat of becoming the first of the BRIC economies to have credit rating downgraded.

 

The government has raised nearly $4 billion through the sale of shares in state-owned companies so far this year, including a $2.2 billion selldown in state-run power utility NTPC last month.

Other issues likely to be launched by the end of this month include a 10.82 percent stake sale in steelmaker Steel Authority of India Ltd that could raise about $600 million and a 12.15 percent divestment in National Aluminium Co Ltd.

Shares in RCF, valued at about $460 million, ended up 3.53 percent on Friday at 45.45 rupees after having risen as much as 5.7 percent during the day, while the Nifty closed 1.41 percent higher.

ICICI Securities, a unit of India's top private lender ICICI Bank, and IDBI Capital Markets were the managers for the RCF share sale.

(Reporting by Kaustubh Kulkarni in MUMBAI; Editing by Jijo Jacob)