Department of Disinvestment, Ministry of Finance, Govt. of India |
25 May 2013 8:23:29 AM |
Promote people's ownership in CPSEs
Ensure better Corporate Governance in CPSEs
Unlock true value of CPSEs for investors, employees, company and Government
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Disinvestment Policy
The present disinvestment policy has been
articulated in the recent President’s addresses to Joint
Sessions of Parliament and the Finance Minister’s recent
Parliament Budget Speeches.
The salient features of the Policy are:
| (i) |
Citizens have every right to own part of the shares of Public Sector Undertakings |
|
| (ii) |
Public Sector Undertakings are the wealth of the Nation and this wealth should rest in the hands of the people |
|
| (iii) |
While pursuing disinvestment, Government has to retain
majority shareholding, i.e. at least 51% and management control of the
Public Sector Undertakings |
On 5th November 2009, Government approved the following action plan for disinvestment in profit making government companies:
| (i) |
Already listed profitable CPSEs (not meeting mandatory shareholding of 10%) are to be made compliant by ‘Offer for Sale’ by Government or by the CPSEs through issue of fresh shares or a combination of both |
|
| (ii) |
Unlisted CPSEs with no accumulated losses and having earned net profit in three preceding consecutive years are to be listed |
|
| (iii) |
Follow-on public offers would be considered taking into consideration the needs for capital investment of CPSE, on a case by case basis, and Government could simultaneously or independently offer a portion of its equity shareholding |
|
| (iv) |
In all cases of disinvestment, the Government would retain at least 51% equity and the management control |
|
| (v) |
All cases of disinvestment are to be decided on a case by case basis |
|
| (vi) |
The Department of Disinvestment is to identify CPSEs in consultation with respective administrative Ministries and submit proposal to Government in cases requiring Offer for Sale of Government equity |
