That the shares will be offered only in dematerialised form has been made clear in the letter of offer which has been given to prospective investors in the Concor scrip. "The shares will be offered only in the dematerialised form", said a syndicate member. "This was made clear in the letter of offer", he added.

The government is offloading nine million shares in the company through a private placement to domestic and foreign institutions. The issue is currently on, and the book-building process is being adopted for the sale of shares.

Concor is among the scrips shortlisted by the Securities & Exchange Board of India (Sebi) where institutions have been asked to trade only in dematerialised form. The institutions will be able to buy in physical form from the secondary market, but can sell the shares only in thedematerialised form.

So, it makes sense for the institutions to receive their shares only in the dematerialised form, otherwise, they would have to incur a dematerialisation cost before being able to sell them.

The government has, however, not given the institutions the option of receiving the shares in physical form, and has, thus, sent out a clear signal that it means business when it says that it is keen to push the dematerialisation process.

According to highly placed finance-ministry sources, the finance secretary Vijay Kelkar feels that as the market goes ahead to eliminate paper from the system, it should ensure that no fresh paper is created. To this effect, he had impressed upon the government to make a start by deciding to offload all its shares in the dematerialised form only.

The finance secretary, the sources said, had made up his mind on pushing for dematerialisation after his presentation to Sebi two months back, and since then, the government has been issuing positive statements. Thisculminated in the prime minister Atal Bihari Vajpayee himself endorsing the benefits of a dematerialised environment. He outlined this as one of the centre's priorities. "Disinvestment means that one shareholder is offering his shares for sale, and this entity is well within its rights to offer these shares in whichever way it deems fit', a top source said.

Sebi has said that from a certain date to be announced soon, all public issues will be made only in the dematerialised form. The modalities are being worked out to zero-in on the date from which this diktat will be applicable. This diktat, however, did not cover public-sector units' disinvestment. Hence, the onus was on the government to offer the shares in the dematerialised form.