An inter-ministerial committee of the Indian government has recommended that state-run iron ore miner NMDC Limited buy back a 10 percent equity stake after the 3 million mt per year capacity greenfield steel mill project being constructed by it is demerged and sold off to a private investor, government sources said on Monday, September 26.
The sources said that the process of demerging the near complete steel mill project in Chhattisgarh will be completed by the end-of-October and the government will invite bids from investors by December.
However, the inter-ministerial committee has recommended that NMDC should buy a 10 percent minority stake in the steel mill to maintain a relationship with the project it conceived and implemented, also because of the significant goodwill it has in the largely backward district of the state.
The committee said that NMDC could be offered 10 percent of equity of the steel mill at the same price seen during the bidding process held for private investors.
The sources said that, even though management control will be vested entirely with the successful bidder, a minority stake remaining with NMDC will ensure seamless operations for the new plant by the new owner supported by the original project constructor.