CCD okays sale of four PSUs

CCD okays sale of four PSUs
ENS ECONOMIC BUREAU

NEW DELHI, AUG 29: The Cabinet Committee on Disinvestment (CCD) decided on Tuesday to sell Hindustan Zinc Ltd (HZL), Sponge Iron India Ltd (SIIL), Mineral Exploration Corporation Ltd (MECL) and Hindustan Insecticides Ltd (HIL) to strategic partners.

He said some concern has been raised on issues like the creation of monopoly after privatisation, but there are no major disagreements. On the query whether oil be granted the strategic status, as petroleum & natural gas minister Ram Naik says, Shourie said there is already a decision that only defence, atomic energy and Railways are in the strategic sector.

Giving details of the CCD decision, disinvestment secretary Pradip Baijal later said MECL will be privatised after the company applies for prospective licensing. Prospective licensing will increase the value of the company. Right now, the company is only in mineral exploration, but it has wherewithal for prospective licensing, he said.

A majority of government stake in MECL will be sold in 2002-03 to the strategic partner, the secretary said.

In the case of SIIL, too, strategic sale has been cleared by the CCD, Baijal said.

For HZL, the government has decided to bring down its equity from 75 per cent to 49 per cent, he said. The sale of 26 per cent equity to the strategic partner will be later followed by retail sale of shares, he added.

Similarly, in the case of HIL, the government will bring down its equity from 100 per cent to less than 50 per cent so that management control could be transferred to the strategic partner, he said.

The disinvestment secretary reiterated the government's preference for strategic sale, as it brings in more value than piecemeal sale of shares.