IDBI Capital, SBI Caps and Edelweiss Capital are among the six investment banks that have submitted bids to the Department of Disinvestment for managing the government’s stake sale in Tamil Nadu-based Neyveli Lignite Corporation (NLC) Ltd, according to sources familiar with the development.
Besides these three, ICICI Securities, Credit Suisse and IDFC Capital are the other merchant banks that are in the race for being chosen as the advisors for the proposed transaction. The last date for submitting the bids was September 10.
“Out of the six, the department will choose three for being appointed as merchant bankers for the Neyveli Lignite transaction,” a banker involved with the bidding process told Express.
The government has decided to disinvest 5% paid-up equity capital of the company through Offer for Sale (OFS) of shares by promoters through the stock exchanges.
NLC has three lignite mines and three thermal power stations in Neyveli, Tamil Nadu and one lignite mine and one thermal power station in Barsingsar, Rajasthan.
Through a joint venture, it is also setting up a coal-based thermal power station of 1,000 MW capacity at Thoothukudi. As on date, NLC is the only listed Navratna company that does not meet the regulatory requirement of a minimum of 10% public shareholding as is required under Securities Contracts (Regulation) Rules, 1957.
Currently, the government holds 93.56% of the paid-up equity capital of the company and balance is held by the public.