The cabinet sub-committee of the Andhra Pradesh government today formally approved the sale of its shareholdings in four listed companies --ACC, Tata Motors, VST and Sirpur Paper Mills -- for an aggregate amount of Rs 75.33 crore (Rs 753.3 million).
The state's shareholding in Tata Motors was sold for Rs 253 per share to LIC realising over Rs 40 crore (Rs 400 million). GIC purchased ACC shares at Rs 200 per share.
Russell Credit, a subsidiary of ITC, bought VST shares for Rs 215 per share, while Aravalis Security and Finance, the promoter of Sirpur Papers, paid Rs 67 per share of the company.
"These prices are substantially above the fair market values arrived at by independent consultants, compared favourably with other reference prices adopted by the state government," the state public enterprises department said in a release.
"We operated a fair and transparent competitive bid process rather than selling anonymously through the market. All who were interested knew we were selling and could take part. This was a novel approach to selling the state government's shareholding in listed companies, as we were not selling a controlling stake or giving over management to the buyers," stated Deepak Kumar Panwar, the principal secretary of the state public enterprise department.
"The approach proved highly successful in achieving good prices while not disrupting the stock market in these shares. It will give added impetus to state's progressive divestment and enterprise reform programme. We will be building on the back of this success with further reforms and divestment in the coming months," Panwar added.
