New Delhi, Oct. 9: The initial public offer of Rashtriya Ispat Nigam (RINL) has been put off for the third time as the steel ministry and merchant bankers could not arrive at a consensus on the price band.
The government, in a statement, however, said it “remains committed to the divestment programme...”.
The RINL issue was supposed to kick-start the divestment programme through which the government aims to garner Rs 30,000 crore. The issue was slated to hit the markets on October 15. Its deferment comes a day after finance minister P. Chidambaram asserted that the divestment process would start with the RINL issue.
“The issue has been deferred,” RINL chairman and managing director A.P. Choudhary said earlier in the day.
Sources close to the development said the steel ministry was unwilling to sell shares at a price lower than the present book value of Rs 22.50 a share. Merchant bankers UBS Securities and Deutsche Equities (India) have proposed Rs 15-17 as the price band.
Differences had emerged in yesterday’s meeting of the high-level committee which was supposed to suggest the price band. Subsequently, the matter was referred to the EGoM to fix the price.
Sources said the empowered group of ministers, headed by finance minister P Chidambaram, did not meet today.
“According to the offer programme, mentioned in the red herring prospectus, the offer was proposed to open on October 15 and close on October 18. In this regard, it is hereby informed that the government has decided not to proceed with the offer programme currently,” an official statement said.