Government To Sell Residual Stake In Tata Communications This Fiscal
The government will sell its entire 26.12% stake in Tata Communications Ltd., erstwhile Videsh Sanchar Nigam Ltd., through offer for sale and strategic sale route in the current fiscal.
In a notice, the Department of Investment and Public Asset Management said a part of the shareholding will be offered through OFS and the balance, including any leftover portion in the OFS, will be offered to strategic partner Panatone Finvest Ltd.
The transaction is to be completed by March 20, 2021, the DIPAM said.
Shares of Tata Communications closed at Rs 1,129.95, up 1.08%.
At the current market price, 26.12% stake in the firm would fetch the exchequer around Rs 8,400 crore.
VSNL was privatised in the year 2002 by disinvesting 25% shareholding along with transfer of management control to Panatone Finvest, the strategic partner.
Subsequent to the strategic disinvestment, the name of the company was changed to Tata Communications.
"The Government of India intends to disinvest its entire shareholding of 26.12% paid up equity capital of TCL, through Offer for Sale method of shares by promoters through the stock exchanges and thereafter to the Strategic Partner," the DIPAM said.
Panatone Finvest would be "obliged to buy the offered shares" at the OFS discovered price, it said.
As per the shareholding pattern of Tata Communications, the promoters hold 74.99% in the company.
Of this, the Government of India holds 26.12% stake, while Panatone Finvest has 34.80% and Tata Sons Pvt. 14.07%.
The remaining 25.01% is with the public.
The government has mopped up Rs 15,220 crore from disinvestment proceeds so far in the current fiscal.
The budgeted disinvestment mop up for current fiscal is Rs 2.10 lakh crore. Of this Rs 1.20 lakh crore is to come from minority stake sale in central public sector enterprises and Rs 90,000 crore from stake sales in state-run financial institutions.