Government To Sell Up to 16.12% Stake In Tata Communications Via OFS, Fixes Floor Price At Rs 1,161/Share
The government on Monday said it will sell up to 16.12% stake in Tata Communications Ltd. through an Offer-for-Sale starting on Tuesday at the floor price of Rs 1,161 per equity share.
As part of its exit plan from Tata Communications (erstwhile VSNL), the government is initially offering to sell up to 2.85 crore equity shares representing up to 10% of the total paid up equity share capital of the company. The government may sell additionally over 1.74 crore equity shares representing 6.12% of stake in Tata Communications as over subscription option.
"The President of India, acting through and represented by the Department of Telecommunications, Ministry of Communications, Government of India, is one of the promoters of Tata Communications Ltd (the "Seller"). The Seller proposes to sell up to 2,85,00,000 Equity Shares of Tata Communications Ltd , representing 10% of the total issued and paid up equity share capital of the company...on March 16, 2021, for non-retail investors only," the government said in the notice for OFS.
The window for sale of shares for retail investors and for non-Retail investors, including who choose to carry forward their unallocated bids, will be opened on March 17. "Offer for sale of GoI equity in TCL opens tomorrow for Non-Retail Investors. Day 2 for Retail Investors. Government would divest 10% shares with an additional 6.12% as Green Shoe Option," DIPAM secretary Tuhin Kanta Pandey tweeted.
The government has reserved minimum of 25% of the offer share for mutual funds and insurance companies subject to valid bids and 10% for retail investors. As per the shareholding pattern of TCL, the promoters hold 74.99% in the company. Of this, the Government of India holds 26.12% stake while Panatone Finvest holds 34.80% and Tata Sons holds 14.07%. The remaining 25.01% is with the public.
The Department of Investment and Public Asset Management plans to sell its entire stake in TCL in the current fiscal. As per the disinvestment plan for TCL, 16.12% of the government shareholding will be offered through OFS and the balance, including any leftover portion in the OFS, will be offered to Panatone Finvest.
So far this fiscal, the government has mopped up Rs 21,302 crore from CPSE disinvestments. The revised disinvestment target for this financial year has been set at Rs 32,000 crore, substantially lower than budgeted Rs 2.10 lakh crore.