New Delhi: PSU employees will now get an option to subscribe up to 5 percent of the issue size at a discount after the completion of disinvestment in the concerned state-owned company.
Seeking to encourage employee participation in the PSU disinvestment through offer for sale (OFS), the DoD had sought approval of market regulator Sebi for allotting shares to employees at a discount of 5 percent to the last cut-off price.
"Sebi has concurred with disinvestment department's scheme of Employee OFS. We will be selling shares to interested employees at a 5 percent discount over the last cut off price in that OFS," a senior government official told the agency.
The employees of such companies in which OFS was undertaken after December would be given the option to buy shares, with 5 percent of the issue size to be offered to them.
To start with, the Department of Disinvestment (DoD) will offer shares to employees in Nalco, Oil India, Rashtriya Chemical and Fertilisers and this would be followed up with SAIL, MMTC and all subsequent disinvestments.
"The employee will have to bid for a minimum of 10 shares up to a maximum value of up to Rs 2 lakh," the official said, adding that they should have a demat account.
As per the proposal approved by Sebi, all permanent and full time employees of such companies and working in India would be eligible for allotment of shares. The list of eligible companies would be provided to the DoD.
The share sale offer for employees would remain open for seven working days and the payment would have to be made at the time of applying for shares.
"We wanted to give employees an opportunity to participate in the government stake sale programme. We expect demand from employees in those companies where share price have gone up substantially post disinvestment," the official added.
The government has set a target to mop up Rs 40,000 crore through stake sale in PSUs in the current fiscal and has already lined up a host of companies, including Coal India, Neyveli Lignite, NHPC and Indian Oil.
First Published: Wednesday, June 19, 2013, 16:33