New Delhi, Nov. 8: The government today approved the divestment of a 10 per cent stake in aerospace firm Hindustan Aeronautics Limited (HAL), while expressing optimism about achieving the selloff target of Rs 30,000 crore this fiscal.
“The Cabinet Committee on Economic Affairs (CCEA) has approved the divestment of 10 per cent equity in HAL out of its holding of 100 per cent through an initial public offer in the domestic market according to Sebi rules and regulations,” an official statement said here.
Finance minister P. Chidambaram said that the HAL board would be restructured before the IPO. However, he said the IPO would be issued in the next fiscal only.
The government expects to raise at least Rs 2,500 crore by divesting 10 per cent in HAL, officials said. The paid-up equity of the unlisted firm on March 31 was Rs 120.50 crore.
The issue of a stake sale was mooted before the CCEA amid the government’s plans to modernise the company, which requires Rs 20,000 crore over the next five years.
The move on HAL comes a day after the government put off Nalco’s selloff on the grounds of the price suggested by the merchant bankers being less than the book value.
“By the end of this fiscal we should get Rs 30,000 crore, that we are confident of...work has started (towards divestment) and issues (of PSUs) will begin to come in a while,” Arvind Mayaram, secretary, department of economic affairs, said.