M A I N   N E W S

Govt to sell residual shares in five more companies
Green signal for CAS from September 1
Tribune News Service

New Delhi, July 10
Encouraged by the resounding success of the initial public offer (IPO) of the Maruti Udyog Limited (MUL) and its listing on the BSE and NSE, the government today decided to sell its remaining shares in five other companies, including the VSNL, IPCL and BALCO.

After a meeting of the Cabinet Committee on Disinvestment (CCD) it was announced that the government shares would be offloaded through public offer. The government would soon seek consent of the strategic partners in the erstwhile PSUs for the purpose.

The impact of the MUL success seemed to so great that the government also decided to sell its 20 per cent equity in Dredging Corporation to public and plough the receipts for modernisation and renovation of its fleet for which the Finance Ministry would give an identical amount.

Announcing the decisions after the CCD meeting chaired by Prime Minister Atal Bihari Vajpayee, the Disinvestment Minister, Mr Arun Shourie, told reporters that the transaction documents for privatisation of three PSUs, including National Fertiliser had been cleared and financial bids from aspirants would be sought soon.

Consequent to the decision, the government would sell its 26 per cent equity each in oil marketing company IBP, telecom giant VSNL and IT company CMC, he said, adding that 33.95 per cent equity in IPCL and 49 per cent shares in BALCO would also be sold to public.

‘‘We will start dialogue with strategic partners (Tatas in the case of VSNL and CMC, Indian Oil in the case of IBP, Sterlite Industries for BALCO and Reliance in the case of IPCL) next week,’’ Mr Shourie said, adding the public sale of equity in these companies would require amendment in share holders and share purchase agreements that the government had signed with them.

Mr Shourie categorically said that the balance government equity in these companies would not be sold to the strategic partner even the latter expressed its desire to that extent.

‘‘The spirit of the decision is to make the equity base broad by selling to public’’, he said.

The strategic partner, however, could be offered the option of increasing its share to 51 per cent through the public offer.

The minister said that the government would exercise caution and take all factors into consideration to ensure that the market was not overcrowded by offering IPO of all five companies.

A Ministerial Group comprising the Disinvestment Minister, the Finance Minister and a Minister from the Administrative Department would work out the modalities and the prices, he said.

Meanwhile, despite threats from cable operators and disagreement with broadcasters, the government today decided to go ahead with the implementation of the conditional access system (CAS).

The decision was taken at the meeting of the Union Cabinet. Although the matter was not listed officially, it came up for an informal discussion. The government, after deliberations, decided to go ahead with the implementation of CAS as scheduled.

“There will be no rollback of CAS. It will be implemented in a manner in which the ministry has decided to roll it out at a meeting last week with broadcasters and cable operators,” the Information and Broadcasting Minister, Mr Ravishankar Prasad, said after the Cabinet meeting. He also said there had been an informal discussion on the issue and the Cabinet decision had been unanimous.

The minister, earlier this week, had informed the Prime Minister, Mr Atal Bihari Vajpayee, that all pay channels would be available to the metro consumers at Rs 72 from August 1, but this would be for only one month. After that, the staggered roll out of CAS would be implemented according to a zone-wise system. At last week’s meeting at the PMO, in which, broadcasters and cable operators had participated, it had been decided that CAS would roll out zone-wise in the four metros from September 1.

There is however now a possibility of the government bringing in at least two legislations for amending the Cable TV Act to enable the smooth implementation of CAS. The I&B Minister, however, parried questions on the issue and merely said the proposal to amend the Act was still being discussed informally.

Sources said, at the meeting, the Prime Minister as well as the Deputy Prime Minister, Mr L.K. Advani, were in favour of the implementation of CAS.