disinvestment

The Union Cabinet today gave its approval for divestment of 10% of total paid up equity of National Buildings Construction Corporation Ltd. (NBCC) out of its holding through Initial Public Offering (IPO) in the domestic market. The Government of India holds 100% of the equity in the Company. This will lead to NBCC listing its shares in the Stock Exchanges. A portion of the shares to be offered for sale through IPO shall be reserved for the employees of the Company. Full Article

The government will soon finalise the roadmap to raise a whopping Rs 40,000 crore through disinvestment during the current fiscal. It will include sale of equity in blue chip companies like SAIL and ONGC. "Cabinet has so far given approval for the disinvestment of four state-run firms - PFC , SAIL, ONGC and HCL . We are in talks with various ministries and working on a roadmap that should be finalised by June-end," Department of Disinvestment additional secretary Siddhar.. Full Article

The Cabinet Committee on Economic Affairs today approved the appointment of Merchant Bankers and other intermediaries to disinvestment transactions involving offer for sale or fresh issue by the company in conjunction with offer for sale be advanced to an earlier stage in the process of disinvestment. Full Article

Fiscal prudence: Corrective measures to repair India's balance sheet seem imminent. The fiscal position stands stressed with a 16-year high deficit of 6.8% of GDP. With Central Statistical Organisation advance estimates hinting at a GDP growth of 7.2% for 2009-10, the government is bound to withdraw some of the stimulus doled out previously. Full Article

Securities and Exchange Board of India has told the government that it favours giving companies five years to increase their public shareholding to 25 per cent. Sebi's letter to the finance ministry follows a proposal by Finance Minister Pranab Mukherjee to increase the minimum public holding in all listed companies - whether government- and privately-owned - in last year's Budget. Full Article

Interest paid on funds borrowed for acquiring controlling stake in a company will not be exempt from tax. The Income Tax Appellate Tribunal (ITAT) has ruled that such expenditure for investing in shares of a company cannot be exempted, since it has not been incurred ‘wholly and exclusively’ for the purpose of earning dividend income. Full Article