Government plans to sell a part of its 49 per cent stake in Bharat Aluminium Company Limited (BALCO), for which it is learnt to have asked its main promoter Vedanta, to take back an ongoing arbitration case.
Sources aware of the development said that the Mines Ministry is said to have requested the Department of Investment and Public Asset Management (DIPAM) to engage with Vedanta to withdraw the arbitration case, as the government plans to take the initial public offer (IPO) route to sell a part of its 49 per cent stake in BALCO.
Mines Ministry is the 49 per cent stakeholder in BALCO and sources informed that DIPAM has held initial discussions with Vedanta to withdraw the arbitration case, which would pave the way for stock exchange listing of the company.
In 2009, BALCO had filed an arbitration case against the government over a valuation dispute of the residual stake.
Sources further added that it is up to DIPAM to decide how much of the government’s 49 per cent stake can be sold.
It could be a residual portion or a major part of it too, a source told IANS.
Though initial discussions have taken place between DIPAM and Vedanta over withdrawal of the arbitration case, sources said that detailed discussions are likely to take place requesting the promoter to withdraw the case, if the sale of the government’s residual stake is to be taken forward.
In 2001, government had disinvested 51 per cent shares of BALCO to Sterlite Industries Limited, a subsidiary of Vedanta Limited.
Major operations of BALCO are in the town of Korba in Chhattisgarh, whereas its mines supplying high grade Bauxite are situated at Kawardha and Mainpat in the same state.
