ONGC stake sale: The government will this week raise around Rs 3,000 crore by selling its 1.5 per cent stake in the country’s top oil and gas producer ONGC. The Offer for Sale (OFS) by the government will remain open on March 30 and 31, Oil and Natural Gas Corporation (ONGC) said in a stock exchange filing on Tuesday.
“The Promoter (Government) proposes to sell 94,352,094 equity shares (representing 0.75 per cent of the total paid-up equity share capital of the Company) of the Company on March 30, 2022 (to non-retail investors). With an option to sell 94,352,094 equity shares (in case of oversubscription) on March 31, 2022 (to retail investors), ”it said.
The floor price for the OFS has been fixed at Rs 159 per share, which is 7 per cent discount to ONGC’s stock closing price of Rs 171.05 on BSE yesterday.
In OFS, at least 25 per cent of the shares are reserved for mutual funds and insurance companies while 10 per cent are reserved for retail investors. Retail investors are defined as an individual investor who bids for not more than 2 lakh shares.
While ONGC employees can apply for equity shares of up to Rs 5 lakh, 0.075 per cent of the equity shares sold in the OFS will be given to the eligible employees at the cut-off price, the filing said.
The government holds a 60.41 per cent stake in ONGC, which produces half of India’s oil and gas.
ONGC informed BSE that the base offer size of the OFS would be 94.35 million shares, with a face value of Rs 5 each, which would constitute 0.75 per cent of the equity of the company. The government will also exercise the option to sell an additional 94.35 million shares equivalent to 0.75 per cent stake in the company while maintaining the oversubscription.
The Comptroller and Auditor General of India said last week that India lost 3.8 million tonnes of crude oil worth Rs 11,276 crore in four years due to water-less injections planned by ONGC in its western offshore fields.
Till January 2022, the Center has been able to raise around Rs 45,485.87 crore through disinvestment and dividend proceeds. The disinvestment target for the financial year 2022, though initially set at Rs 1.75 trillion, was later reduced to Rs 78,000 crore. Budget 2022.
Union Finance Minister Nirmala Sitharaman in her previous budget for 2020-21 had set a target of raising Rs 2.1 lakh crore from privatization and sale of minority stake in state-owned firms. The disinvestment, ahead of the end of the financial year on March 31, comes after the government deferred an initial public offer for the country’s largest insurer Life Insurance Corp to next year due to market volatility.
On Tuesday, ONGC shares closed down 3 per cent at Rs 171.05 on the BSE.
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