The Indian government has ruled out any strategic sale of Mecon Limited (formerly Metallurgical and Engineering Consultants Limited), an engineering procurement and construction (EPC) consultants under the Ministry of Steel, a government official said on Friday, December 21.
He said that the Ministry of Steel in a communication to Department of Investments and Public Asset Management (DIPAM) which overseas disinvestment of equity stake in government companies that in view of the national steel policy envisaging creation of 300 million mt per year domestic steel making capacity and growth plans of government steel companies in which Mecon is expected to play an important role, there is no need to change the ownership pattern of the steel sector engineering consultants.
In the same communication to Dipam, the Ministry of Steel has also said it ‘is not the appropriate time for the government to go ahead with an initial public offer’ for wholly government owned steel producer, Rashtriya Ispat Nigam Limited (RINL), the official said.
The Ministry of Steel in the communication pointed out that given the financial performance of RINL in the immediate three preceding years, where the company incurred losses it will be advisable for the government not to dilute any part of its existing 100 percent equity through an IPO for RINL and go in for public listing of shares of the steel company,” the official added.