Anil Agarwal
The Cabinet Committee on Economic Affairs (CCEA) approved the sale of the
government's residual stake in Hindustan Zinc (HZL) on Monday ending months of uncertainty on the issue.
The government had sold a majority stake in the nation's largest zinc maker to business magnate Anil Agarwal-led Sterlite in 2002 which is now being investigated by the Central Bureau of Investigation for allegedly being undervalued at the time.
The government still holds a 29.5- per cent stake in the company, which Sterlite, now named Vedanta Resources, sought to acquire. With a market capitalisation of Rs 56,006 crore, the government's stake in HZL is valued at Rs 16,521.77 crore.
"It has been cleared," commerce and industry minister Anand Sharma told reporters here after a meeting of the CCEA, headed by Prime Minister Manmohan Singh.
The decks for the sale were cleared after the attorney general finally expressed the view that there would be no problems in selling the stake through an auction since HZL is no longer a public sector company. His earlier view was that the sale of the residual stake would require an approval of Parliament since the company was created by an Act.
The latest move came after a flurry of meetings and Singh himself stepping into the picture to take up the issue of selling the residual stakes in HZL and Bharat Aluminum Company Ltd (Balco) through the auction route. While the finance ministry was keen to rush through the sale of the residual stake in HZL, the ministry of mines had reservations due to the complex legal issues involved.
Last month, Agarwal had said that the company had received positive indications from the government and the sale could occur soon. "We are getting the indications but it is a democratic process. Sometimes it gets delayed but it will happen," the London- based businessman had said.
Vedanta had obtained the support of its shareholders last October to offer up to $3.48 billion to buy the government's minority stakes in HZL and Balco.
Courtesy: Mail Today
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