JOIN US Centre today cleared a proposal to sell its stake in state-owned construction company NBCC India with an aim to meet the ambitious Rs 56,500-crore PSU disinvestment target in 2016-17.
"The Union Cabinet has approved the proposal of follow-on public offer (FPO) by NBCC India to divest the central government's stake in the company," a source said after the meeting.
At present, the government holds 90 per cent in the company, which has a market capitalisation of Rs 14,274 crore.
Without divulging details on the quantum of stake sale, the source said the Centre will have to divest at least 15 per cent to meet Sebi's public listing requirements.
The rules say the minimum public holding in a company has to be maintained at 25 per cent.
NBCC was listed on the bourses in 2012 when the government diluted 10 per cent stake to raise Rs 127 crore. The price band of the NBCC IPO was fixed at Rs 90-106 per share.
Earlier, in May this year, shareholders had approved stock split to facilitate the FPO under the government's disinvestment programme. The company has split its share of Rs 10 each into five with a face value of Rs 2 each.
The company's stock was trading at Rs 234, down 9.09 per cent, on BSE today.
The source said the Cabinet at its meeting today also approved the proposal of asset sale in its telecom equipment manufacturing firm, ITI Ltd.