Govt clears 9.5% stake sale in NTPC

The government on Thursday approved a 9.5 per cent stake sale in the public sector power behemoth NTPC which is expected to raise Rs 13,000 crore to the exchequer and help the government reach the half-way mark of this year’s disinvestment target of Rs 30,000 crore.

The government currently holds 84.5 per cent in NTPC and post-disinvestment, the government’s stake would come down to 75 per cent.

“The Cabinet Committee on Economic Affairs has approved 9.5 per cent paid-up equity capital in NTPC out of the government’s shareholding of 84.50 per cent, a proposal by Department of Disinvestment, Ministry of Finance,” sources said after the meeting.

The paid-up equity capital of the company, as on March 31, 2012 was Rs 8,245.46 crore.
The nod for disinvestment in NTPC came a day after the government gave a go-ahead to Hindustan Copper, which is expected to fetch it another Rs 1,376 crore.

NTPC, which is primarily engaged in the business of power generation through coal-based and gas-based sources, is under the administrative control of Ministry of Power.

The government also decided to reallocate three coal blocks that were taken away from NTPC for delay in the development of those mines. The reallocation is expected to raise the overall valuation of the company.

The government also took note of NMDC's acquisition of 50 per cent stake in Australia's Legacy Iron Ore for Rs 99.63 crore.

"The acquisition process has been completed and NMDC is now a majority shareholder on the Board of Legacy," an official statement said.

 Legacy is a Perth-based exploration company with focus on iron ore, gold, manganese and base metals. Incorporated in April, 2007, Legacy was listed on the Australian stock exchange in July 2008.