Listed PSUs get time till Aug ’18 to meet public holding norm

15-07-2017
DH

The deadline has been extended to avoid bunching of share sale offers from state-owned firms and the government gets to decide on the opportune time to divest stake in any PSU, including the blue chip ones.

A top official in the ministry said that the government is very clear that the stake sales should not happen at unfavourable prices and at a time when there is a possibility of rival public offers from PSUs crowding each other out.

The finance ministry, in a notification last week, has further amended the Securities Contracts (Regulation) Rules, 1957, to give to Central Public Sector Enterprises (CPSEs) four years from September 2014 to meet the minimum public float requirement. Market regulator Sebi had mandated a minimum 25% public float for all listed companies. 

This was extended to state-owned firms who were initially given three years to meet the norm. 

The three-year deadline as notified by the Ministry in September 2014, was due to end on August 21, 2017. There are six PSUs — Hudco, Coal India, Hindustan Copper, SJVNL, MMTC, Neyveli Lignite, which are yet to reach the minimum 25% public shareholding requirement stipulated by market regulator Sebi in mid 2014.

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