The government will raise at least Rs 2,250 crore (Rs 22.5billion) for selling its residual stake in the country's top carmaker Maruti Udyog Ltd to banks and financial institutions, as it has fixed a floor price of Rs 760 a share.
As many as 36 banks, financial institutions and mutual funds have expressed interest in buying the stake. These include LIC, SBI, Corporation Bank and Union Bank of India, a government official told reporters in New Delhi.
"We hope to complete the sale by tomorrow," he said. The government will sell 2.96 crore shares, representing 10.27 per cent stake in Maruti. Sources said bids of at least Rs 10 crore (Rs 100 million) will be invited for the purpose. Maruti's share was trading at Rs 802.05, up Rs 0.02 per cent from Tuesday's close.
According to sources, the bids were to be opened on Wednesday, but it was postponed for Thursday as Heavy Industry Minister Sontosh Mohan Deb, whose ministry holds the stake, was away in Guwahati. Deb accompanied Prime Minister Manmohan Singh, who is filing his nomination for the Rajya Sabha.
The government had invited Expressions of Interest for the stake in February, but deferred selling due to volatility in stock markets.
The other reason for the delay was that the government was awaiting Suzuki's nod on whether LIC could be allowed to increase its holding beyond 10 per cent.
With Suzuki giving a go ahead, LIC would be able to participate in the sale aggressively. LIC already holds over 8 per cent stake after buying more than half of the shares sold by the government last year.
When government sold 8 per cent shares in Maruti, it had put a condition that no financial institution would be allowed to increase its stake beyond 10 per cent through participation in the disinvestment process.
