The government of India plans by March 31, 2010 to sell 8.38 percent stake in state-owned iron ore miner National Mineral Development Corporation (NMDC) through a follow-on public offer, seeking to raise around $3 billion.
"The government of India has desired to complete the process of disinvestment of 8.38 percent of paid-up equity in NMDC, out of government's shareholding through further public offer in the domestic market during the current financial year," reads NMDC's statement to Bombay Stock Exchange.
As of September this year, the government held about 98.38 percent in NMDC, but, as part of a plan to cut ownership of profitable state-run companies, it needs to reduce its holding to 90 percent. The sale would be the largest divestment of a government holding since 1991, when India began a policy of financial liberalization.
Reportedly, India aims to sell shares in about 60 state-owned companies in the coming years, as the government races to raise funds for speedier reforms and to cover a widening fiscal deficit. India plans to spend $8.95 billion in the year ending March 31 to improve infrastructure and boost economic growth.