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NEW DELHI: State-run companies need to be more accountable to the people of the country and the government has taken the decision to dilute equity stake for making them more professional, Union minister Dharmendra Pradhan said on Thursday.
The Cabinet Committee on Economic Affairs had on Wednesday decided to sell the government’s entire stake in the country’s second-largest state refiner BPCL and India’s largest shipping company Shipping Corporation of India (SCI). It also approved privatisation of Container Corporation of India while also giving nod to paring stake below 51 per cent in select public sector undertakings but without losing control.
The opposition Congress on Thursday staged protests in Parliament against privatisation of BPCL and Shipping Corp.
“We need to be accountable…that is why we took these decisions. The Prime Minister took these decisions in Cabinet meeting yesterday. We are going for equity dilution that means going for more professionalism and I believe you (PSUs) must…promote it,” the steel minister said in his address at the ISA Steel Conclave event here.
IOC may not bid for BPCL
Pradhan on Thursday hinted that public sector firms such as Indian Oil Corporation (IOC) may not be allowed to bid for buying government stake in Bharat Petroleum Corporation Ltd (BPCL), for which a buyer may have to shell out as much as Rs 90,000 crore.
BPCL will give buyers ready access to 14 per cent of India’s oil refining capacity and about one-fourth of the fuel marketing infrastructure in the world’s fastest-growing energy market.
“Finance Minister (Nirmala Sitharaman) has stated that the privatisation of BPCL will happen this fiscal and we hope to adhere to the timeline.” Asked if public sector units will be allowed to bid for the government’s 53.29 per cent stake, he said: “Nitty gritty and details of the disinvestment process will have to be worked out but when I say the government has no business to be in business, it is indicative of possible future course of action.”
At the current trading price of BPCL, the government’s 53.29 per cent stake is valued at a shade less than Rs 62,000 crore. On top of this, the acquirer will have to make an open offer to buy an additional 26 per cent stake from minority shareholders for about Rs 30,000 crore. (PTI)