Centre to disinvest 8 pc stake in Maruti Udyog

Defence Minister Pranab Mukherjee, however, played down the his government’s fear of the Left. When asked whether all allies of the UPA government, including the Left, supported the move, he said: ‘‘Today’s Maruti is different from earlier times. What is left (of the government equity) in Maruti?’’

The disinvestment, to be done through competitive bidding with the current market price of Rs 513 as the benchmark, would bring down government holding to 10.28 per cent.

Mukherjee did not give any time frame for the share sale, saying such a move did not have ‘‘any specific time’’ as the shares would be sold when the market is bullish. First, the government would select advisors to assist in the sale transactions, he said.

Even if the sale takes place at the current market price of Rs 513 per share, the equity offload is expected to fetch around Rs 1,092 crores.

Maruti share prices appreciated by over Rs 28 on the Bombay Stock Exchange after the news.

‘‘The unlocking of amount from non-strategic investment would thus mobilise resources so as to be utilised by the government in sectors that require attention on priority,’’ said a government statement.

The funds are likely to be parked in the National Investment Fund to be created for assisting the social sector and restructuring of public sector units. Returns from the NIF corpus would be utilised for the twin purposes and not the corpus itself.

In June 2003, the government sold 27.5 per cent of its 45.8 percent equity through an initial public offering, mopping up Rs 993 crore.