Public CompanyICICI, Citi among 17 in race to manage NMDC issue
ICICI Securities, Citigroup and Morgan Stanley along with 14 other merchant bankers have submitted bids to manage the estimated Rs 14,000-crore disinvestment of the state-run iron ore producer NMDC.
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The merchant bankers will make presentations on Tuesday and Wednesday before the inter-ministerial group, set up under the Finance Ministry to pursue the disinvestment programme of the government, an official said here today.
The Department of Disinvestment plans to shortlist four to six book runners-cum-lead managers out of these 17 merchant bankers.
Based on the current share price, the government could raise about Rs 14,000 crore by offloading 8.38 per cent stake in NMDC. The government at present holds about 98.38 per cent stake in the country"s largest iron ore miner.
"The government intends to complete the transaction in such a manner and time that the FPO proceeds are realised before March 31, 2010," the official added.
The other merchant bankers which have shown interest in the deal include JM Financial, SBI Capital, Kotak Mahindra IDFC-SSKI, Enam Securities, DSP Merril Lynch, Deutsche Bank, Nomura Financial, IDBI Capital, Edelweiss Capital, Axis Bank, Karvy Investors, RBS Equities, and UBS Securities, he added.
NMDC today closed up 2.11 per cent at Rs 404.05, on the Bombay Stock Exchange even though the index slipped 119 points.
Last week, taking the divestment programme in the iron ore major forward the selloff department had invited applications for appointing lead managers to advice it on the the issue details and asked the interested banks to submit proposals by December 18.
The Cabinet Committee on Economic Affairs had earlier this month given its approval for the additional stake sale in NMDC.
"The Sebi may not agree to treat this case as a fast track issue. Even so, all concerned will have to ensure that all the processes involved are completed with least delay and methods evolved to reduce them," the official said.