Tata Communications Stake sale: Shares of the company declined by up to 7 per cent on Tuesday 16 March, after the central government decided to sell its stake in Tata Communications. The government is reducing stake in Tata Communications through Offer for Sale (OFS). The central government is selling about 2.85 equity shares of Tata Communications which is 10 per cent of the total issued and paid-up equity share capital of the company. Apart from this, the central government is also selling additional 1.74 crore equity shares, which is 6.12 percent of the total issued and paid-up equity share capital of the company. In this way, the government is selling its 16.12 per cent stake in Tata Communications. The floor price for OFS has been fixed at Rs 1,161 per share.
On March 16, due to the sale of 16.12 per cent in communications by the government, its price has come down by 7 per cent. Shares of Tata Communications on NSE and BSE are trading at around 12:30 rupees at 1:30 pm. According to the information given on the Department of Investment and Public Asset Management, the government has so far raised Rs 21,302.92 crore through disinvestment in the current financial year 2020-21.
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Government holds 26.12% stake
According to the notice issued to the OFS by the central government, the President of India is one of the promoters of Tata Communications (formerly called VSNL) who are representatives of the Department of Telecommunications under the Ministry of Telecommunications. Under the government’s proposal, it will sell its 16.12 per cent stake in the company under the Offer for Sale. As a promoter, the President holds 26.12 per cent stake in the company. Promoters hold a total of 74.99 per cent stake in the company. Tata Sons holds 14.07 per cent stake and Panatone Finvest Limited 34.8 per cent in the company.
Sale is going on 16 and 17 March
According to information by the central government, on March 16, the government is selling 10 per cent stake under OFS and this offer is only for non-retail investors. Tomorrow, on March 17, the government will sell 6.12 per cent under OFS and the offer will be open to retail investors and non-retail investors. The government has reserved a minimum 25 per cent stake for mutual funds and insurance companies and 10 per cent for retail investors.
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