5% stake sale likely in 2-3 months: Neyveli Lignite

Amid apprehensions by trade unions with regard to divesting five per cent stake in  Neyveli Lignite Corporation (NLC), company CMD B Surender Mohan today expressed the hope that proposed share sale through offer for sale route may happen in two-three months.

"We are trying to convince the trade unions. We are hopeful that the stake sale in the PSU may happen either in June or July," he told PTI.

He said the company had a meeting with trade unions on the matter last month.

The coal ministry had recently conveyed to the Department of Disinvestment (DoD) apprehensions of NLC's trade unions with regard to the proposed stake sale in the public sector undertaking.

The development followed the ministry receiving a letter from DoD on five per cent stake sale in NLC, a Navratna company.

The government had earlier said the proposed stake sale in NLC was "not necessary" in 2012-13 financial year as this has to be completed only before July 2013.

The government, which holds 93.5 per cent in NLC, has been trying for some years to sell certain percentage of stake in the PSU.

However, the attempt faced opposition from trade unions, as well as on the political front.

Recently, NLC had invited bids from global firms to acquire coal assets abroad for providing fuel security to its thermal power plants.

The state-owned firm has proposals for growth in power generation capacity and is expanding its activities not only at Neyveli but in other parts of the country. It has entered into a joint venture with Uttar Pradesh to set up a 1,980 MW power station at Ghatampur, near Kanpur.

NLC also has a proposal to establish a power plant with a capacity of 4,000 MW at Sirkali in Tamil Nadu. It is also planning to bid for ultra-mega power projects (UMPP) of 4,000 MW under rate based competitive bidding.

The shares of the company today closed at Rs 68.90 a scrip on the Bombay Stock Exchange, a gain of 0.51 per cent from the previous close.