CHENNAI: Strongly opposing the union government’s decision to further disinvest its equity in the Neyveli Lignite Corporation (NLC) in the state, Chief Minister C Joseph Vijay on Thursday urged Prime Minister Narendra Modi to reconsider the latest move.
Till March 31, 2026, the GOI is holding a 72.2% stake in the company. If 3% stakes are disinvested, the GOI’s stakes in the Navratna Public Sector Undertaking will go down to 69.2%.
Expressing deep concern about the union government’s decision to proceed with the proposed disinvestment of up to 3% of its equity in the NLC through an Offer for Sale, comprising a 2% base offer and a 1% green-shoe option, as notified, the CM, in his letter to the PM, pointed out that Tamil Nadu has been consistently opposing the reduction of GOI’s shareholding in the NLC.
The CM said the NLC India is not merely a listed company but a strategic national asset engaged in energy security, mineral development and critical infrastructure. “Any further dilution of the GOI’s equity, however limited, sets an undesirable precedent in respect of public ownership of such strategically significant enterprises.”
The CM recalled that the NLC India, headquartered at Neyveli, Tamil Nadu, has been built over several decades on land acquired through the state machinery, supported by extensive administrative facilitation, infrastructure development, rehabilitation measures and the cooperation of the people of Tamil Nadu. “The state, therefore, has a legitimate and enduring stake in the future of this strategically important PSU,” he said.
“Public sector enterprises of this nature, particularly those established and expanded with the sustained support of a host state over decades, should continue to remain firmly under effective Government ownership and control,” the CM added.
Vijay said the decision also raised concerns that extend beyond financial considerations and touch upon the long-term interests of the state, its people and the nation’s energy security. “This issue is of special significance to Tamil Nadu, as NLC India is intrinsically linked to the state through its origin, growth and continuing operations,” he added.
The union government has gradually reduced its shareholding in NLC India Limited over the past two decades, with every major disinvestment facing strong opposition from political parties, employees’ unions and successive TN governments.
Ever since the central government started its move to disinvest the profit-making Navratna Public Sector Undertaking, NLC, from 2003, former CM J Jayalalithaa has been consistently opposing the effort. In 2006, when the initial public offer of about 10% was announced to comply with the SEBI listing norms, the employees’ union opposed it, fearing gradual privatisation. Later, in 2013, when the GOI made another move to further disinvest the NLC, political parties and the workers of the NLC staged agitations.
In 2013, the AIADMK government successfully prevented the centre’s proposed 5% disinvestment of NLC to private investors by getting five Tamil Nadu state PSUs to acquire 3.56% of the company’s equity through an Institutional Placement Programme. The transaction was worth about Rs 360 crore, while the original proposed 5% sale was estimated at around Rs 455-460 crore. At that time, Jayalalithaa took a strong decision to buy the NLC’s equity.
The DMK has consistently opposed the centre’s disinvestment of NLC India Ltd over the past two decades. In 2006, while it was a key ally in the UPA government, the DMK forced the centre to withdraw its proposal to divest a 10% stake after strongly opposing the move and backing workers’ protests. In 2013, after exiting the UPA, the party again opposed the centre’s decision to sell a 5% stake.