The Indian Government has kick started the disinvestment program through sale of 5% stake in SAIL (Steel Authority of India) today Dec 5,2014. The floor price of INR 83 per share will be sold throughsale route. A 5% discount will be provided for the share to the retail investors. According to the finance ministry, the government intends to raise a capital of INR 1,500-1,700 crore through the sale of stake in SAIL.
The floor price would provide a 2.75% discount to the closing price of SAIL shares which ended 0.35% down at INR 85.35 on BSE yesterday Dec 4, 2014.
10% of the offered shares has been reserved for retail investors, who are allowed to buy INR 2 lakh worth of shares in the sale route. A minimum of 25% of the stake issued will be reserved for mutual funds and insurance companies.
The cabinet of the UPA (United Progressive Alliance) led by Dr.Manmohan Singh government approved a 10.82% stake sale in SAIL on July 2012.. The first set of disinvestment of 5.82% was completed in March 2013.