CCEA approves disinvestment of 15 per cent in NBCC
Avneet Kaur July 14, 2016
The Cabinet Committee on Economic Affairs (CCEA) has approved the disinvestment of 15 per cent paid-up equity of National Buildings Construction Corporation Limited (NBCC) out of government's 90 per cent shareholding.
The disinvestment is estimated to generate receipts of Rs 1,706 crore approximately to the government.
The CCEA also decided to allot additional shares to the eligible and willing employees at a discount of 5 per cent to the issue/discovered (lowest cut off) price of the OFS.
As per CMIE, the government aims to collect Rs 56,500 crore through disinvestments in PSUs in 2016/17. This is 18.7 per cent lower than the Rs 69,500 crore the government had targeted in the last Budget. Of the total budgeted proceeds, Rs 36,000 crore is estimated to come from minority stake sale in PSUs and the remaining Rs 20,500 crore is projected to come from strategic sales.
NBCC was incorporated on 5th November, 1960 as a wholly owned Government of India enterprise under the administrative control of the Ministry of Urban Development with the objective of becoming a leading company in the field of construction, engineering and project management consultancy services.
The issue and subscribed equity capital as on 31st March, 2016 was Rs 120 crore. The government holds 90 per cent of the equity, that is, 540 million shares. The face value of each NBCC share is Rs 2. The balance 10 per cent of the equity is held by the public.
The NBCC IPO (initial public offering) was launched in March, 2012, when the Government of India divested 10 per cent paid-up equity capital of NBCC out of its 100 per cent shareholding and got the Company listed on the stock Exchanges. The GoI realised Rs 124.97 crore as proceeds towards the share sale.