The 5.82% stake sale of Steel Authority of India Ltd is scheduled to take place on Friday at a floor price of Rs 63 per share. The Empowered Group of Ministers (EGoM) headed by Finance Minister P Chidambaram fixed the minimum price at a 1.41% discount to closing price in order to mop up at least Rs 1,514 crore.
The EGoM met twice in two days to deliberate on the floor price worried over the volatility in the SAIL stock. “We need to keep market condition in mind,” SAIL Chairman, C S Verma said after the EGoM meeting. Its shares have dropped more than 30% since March, 2012 and closed at Rs 63.90, down 1.77% on the BSE.
While the government intends to offload 10.82%, only 5.82% of its stake will be sold. The remaining 5% may be sold in the next fiscal. The divestment of 10.82% would bring the government’s stake in SAIL to 75%.