The government has invited bids from merchant banks to manage stake sale of Hindustan Zinc Ltd., pressing ahead with its asset sales to meet its divestment target.
"The Government of India intends to disinvest its entire residual shareholding of 29.535% paid up equity capital of HZL through SEBI approved methods in the open market in tranches," read a notification from the Department of Investment and Public Asset Management on Thursday.
The last date for submitting bids is till 3 p.m. on July 28 and technical bids will be opened on July 20, according to the document. The total market value of the stake is worth Rs 32,058 crore at current prices.
BQ Prime had earlier reported that the Ministry of Finance is in the process of hiring financial advisers and aims to invite bids from potential investors by the end of August.
The notification also put out a list of criteria for eligibility. Bidders seeking to be merchant banks to the stake sale should have handled and completed at least one domestic equity issue (initial or further public offering or offer for sale) worth Rs 5,000 crore or more from April 1, 2019 to March 31, 2022.
The divestment of Hindustan Zinc is important for the government as the privatisation of Bharat Petroleum Corp. was called off and sale of Container Corp. has been facing delays. Sale of Pawan Hans and Central Electronics Ltd. has also been shelved after tepid response.
The government has set itself a disinvestment target of Rs 65,000 crore in the financial year 2022-23. It has so far raised Rs 24,046.4 crore, including Rs 20,516.12 crore from the LIC IPO.
Anil Agarwal-led Vedanta Group owns majority stake in Hindustan Zinc. The firm acquired 26% shareholding along with management control in 2002. A year later, the group bought another 18.92% and then purchased 20% more from the market.
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