Centre eyes ₹8,000 crore from TCL exit
NEW DELHI: The government will sell its remaining 26.12% stake in Tata Communications Ltd (TCL), a small part to stock market investors through an offer for sale (OFS) and the bulk to majority owner Tatas, aiming to raise around ₹8,000 crore before the end of the current fiscal year.
The sale will mark the government’s exit from the erstwhile Videsh Sanchar Nigam Ltd (VSNL), which was privatised in 2002. “Part of the stake will be sold through OFS and on the discovered price, and the rest of the stake will be sold to Tatas. Though how much exactly will be sold through OFS has not been decided yet, the cabinet committee on economic affairs has approved selling up to 16% stake through OFS and the remaining to Tatas,” a finance ministry official said seeking anonymity.
The department of investment and public asset management (DIPAM) has invited bids from merchant bankers-cum-selling brokers and has set February 3 as the last date to submit bids, which will be opened on February 4. The transaction is to be completed by March 20.
VSNL, a central public sector enterprise, was privatised by divesting a 25% shareholding along with transfer of management control to Panatone Finvest Ltd, named the strategic partner (SP). Subsequent to the strategic disinvestment, VSNL
was renamed Tata Communications. “The SP (Tatas) had given an open offer at the time of strategic disinvestment in 2002; the present transaction including transfer of shares to promoters namely the SP, is to be structured in a manner that it does not trigger open offer again. The appointed MB (merchant banker) would advise the government in this regard and also on any exemption from Sebi is required in the matter,” DIPAM said in the bid document.
The consolidated profit after tax of TCL in the December quarter rose 4.28% from a year ago to ₹309 crore, driven by robust growth in profitability and revenue from the data business, the company said on Tuesday. TCL posted a consolidated operating profit or Ebitda of ₹1,046 crore in the quarter, up 37.5% from a year ago, on the back of margin expansion in data business and cost optimisation initiatives.