Government undecided on time line of Hindustan Zinc share sale
New Delhi: The Mines Ministry on Thursday said there are lots of "complex" issues that need to be addressed before selling government's remaining stake in Hindustan Zinc and no time frame can be given for that.
"These are all complex issues, which require lot of consultations. There is no yes or no type thing. I am not in a position to give you a time frame, we are looking at various options," Mines Secretary Rajen Habib Khwaja told reporters here.
The issues include taking permission from Parliament as the company was formed through a statute. Besides, modalities of share sale needs to be decided, he said.
The government, which currently holds 29.5 percent stake in Hindustan Zinc, has been looking at exiting from the company and has been exploring various options, including offer for sale (OFS) and e-auction routes, to fetch the best price.
However, selling the remaining government stake requires Parliament approval as the company was formed through a statute and the Mines Ministry, the parent ministry of Hindustan Zinc, has not yet decided on approaching Parliament.
"The Supreme Court had stayed the disinvestment of some petroleum companies in 2003 as they were formed through a statute and required Parliament approval, to become eligible for disinvestment.
"Same applies to Hindustan Zinc also, which has also been formed in the same way. Without Parliament approval, we can not sell the residual stake of the government," Joint Secretary in the Mines Ministry Durga Shankar Mishra said.
However, the Mines Ministry officials remained non-committal when asked whether they would seek Parliament approval in the forthcoming Budget session.
"We have to look at all the complexities (before deciding on selling remaining shares of HZL), it is not so simple," the Mines Secretary said.
In January, 2012, Vedanta Resources had offered Rs 17,275 crore for buying out remaining stake of the government in Hindustan Zinc and Balco and has been waiting to get a response since then.
Vedanta had valued government's 29.5 percent stake at Rs 15,493 crore (USD 2.938 billion) in Hindustan Zinc. The company Board had also taken shareholders approval in August last year to sweeten the offer by up to 15 percent to about Rs 18,606 crore (USD 3.378 billion).
At present, Hindustan Zinc is the richest profit-making subsidiary of Vedanta with a cash and cash equivalent of Rs 19,282 crore as on December, 2012. The company had reported a net profit of Rs 5,526 crore and net revenues of 11,405 crore in 2011-12.