Govt plans 10% stake sale in MIDHANI via offer for sale

The government is planning to sell up to 10% stake in defence PSU Mishra Dhatu Nigam Ltd (MIDHANI) in the current fiscal ending March, an official said. 

The company got listed on stock exchanges in April 2018 and the government had raised 438 crore by selling 26% stake through IPO.

The official said that with the opening of space sector to foreign investment and bringing defence sector under automatic route for 74% foreign direct investment (FDI), MIDHANI shares are expected to attract investors. 

MIDHANI manufactures special steel and super alloys for use in defence, nuclear and space sectors. 

“We are looking at up to 10% stake dilution via offer for sale,” the official said. 

Shares of MIDHANI closed at 193.50 apiece on the BSE on Friday. 

At the current market price, the government can raise about 360 crore by selling 10% stake in the company.

The official further said that with big ticket divestment plans hit by the COVID-19 pandemic, the government is readying public sector companies for minority stake sale in the remaining months of current fiscal.

So far this fiscal, the government has raised 6,138 crore by selling minority stake in Hindustan Aeronautics Ltd and Bharat Dynamics Ltd through offer for sale so far this year. The government also divested 15.2% in Mazagon Dock Shipbuilders Ltd through an initial public offering.

The government has set a 2.1 lakh crore disinvestment target in current fiscal. This includes 1.20 lakh crore through CPSE stake dilution and 90,000 crore through stake sale in financial institutions — more than four times what it raised last financial year.

This story has been published from a wire agency feed without modifications to the text.

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