Share Buyback by Coal India, KIOCL Next Month Part Of Centre’s Disinvestment Plan

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The disinvestment programme of the Centre will get a push as state-run Coal India Limited and KIOCL or formerly Kudremukh Iron Ore Company are set to buyback their own shares.

Share Buyback by Coal India, KIOCL Part Of Centre's Disinvestment Plan

Mahanadi Coalfields (MCL), wholly-owned subsidiary unit of CIL, will buyback shares equivalent to 25% of its aggregate fully paid-up capital from the parent company. CIL will then use the proceeds to buyback shares from other shareholders and the government. The Centre has a stake of 78.32% in CIL. It is worth mentioning that surplus cash with Mahanadi Coalfields as on March 31, 2018 amounted to Rs. 13,301 crore.

Meanwhile another company, KIOCL in its board meeting held on September 18, 2018 has approved the proposal to buyback 1,25,88,235 equity shares at a price of Rs. 170 per share of face value Rs.10 each, payable in cash for an aggregate consideration not exceeding Rs. 214 crores.

The company has fixed record date for the KIOCL buyback as October 1, 2018 to discover the entitlement as well as the beneficial owners or eligible shareholders who will be able to participate in the buyback.

The Centre so far as part of its disinvestment scheme has garnered only Rs. 9,220 crore or a little more than 11% of its annual disinvestment target. Further, as it aims to exceed the FY19 disinvestment target of Rs 80,000 crore, it has planned a series of disinvestments to be completed until November end. As per an official, the Centre can mop up close to Rs. 12,000 crore via buybacks by PSU majors including CIL, KIOCL, Oil India, ONGC etc.

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This story has not been edited by Topic Hunt (with the possible exception of the headline) and has been generated from a syndicated feed. (GoodReturns)

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