India raises $279m from Sail in bid to save rating

India aided its bid to avoid a credit downgrade by raising $279 million from selling shares in state-run Steel Authority of India Ltd (Sail), but needed help from state investors to do so.

By (Reuters)

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Published: Sat 23 Mar 2013, 11:31 PM

Last updated: Fri 3 Apr 2015, 5:08 AM

The share sale on Friday is part of the government’s divestment drive to help restrict the fiscal deficit to 5.2 per cent in the year ending March 31, to avoid becoming the first of the Bric economies to have its credit rating downgraded.

The government has now raised almost the entire $4.4 billion it had sought to raise through the sale of shares in state-owned companies so far this fiscal year. It had initially hoped to raise $5.5 billion but scaled down its target later in the year.

The single-day Sail auction received bids for a total of 241.3 million shares, at a weighted average price of Rs63.07.

New Delhi was selling 240.4 million shares or 5.82 per cent stake at a minimum offer price of Rs63 a share, to bring down its holding in the company to 80 per cent. The sale was the last government divestment for the current fiscal year.

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