Troubled by the messy share sale of state-owned ONGC,a visibly cautious finance ministry is set to revamp the newly introduced offer for sale (OFS) or auction route before using it for other divestments.
The department of disinvestment (DoD) is planning two critical reforms in the route,disinvestment secretary Mohammad Haleem Khan said,stressing that Auction is a very efficient process and saves a lot of time. We are not going to abandon it.
To begin with,the department now plans to use only one exchange platform for placing of bids rather than using the services of multiple platforms. In the ONGC auction,investors could place bids at the BSE as well as the National Stock Exchange.
However,the share sale was marred by technical glitches the stock
exchanges failed to upload the subscription amount leading to confusion in the markets about the total value of bids received.
Since it was a big deal,we thought there should be two platforms. But we didnt realise that when an investor puts money with a custodian,he has to bifurcate it for each exchange. This wasnt done, Khan said,commenting on the ONGC auction.
The other measure the department is contemplating is to open the auction window for a shorter time span rather than allow bids throughout the day.
It is not necessary to have bids for holding. We will probably open it around 12 noon and close it by 3:30 in the afternoon, Khan said.
Sebi had introduced the OFS route in February this year as a separate window to allow promoters to offload holdings in listed companies.
ONGC was the first company to use the OFS route for a 5 per cent sale of government equity last month.
Stake sales in firms such as BHEL and SAIL could be done through OFS to meet the Rs 30,000 crore target in 2012-13.