Government-generated value for CPSE investors through stake sale, OFS and market listing

New Delhi [India], December 16 : As the year 2024 draws to a close, the Finance Ministry highlighted key achievements of its disinvestment drive, showcasing significant transactions led by the Department of Investment and Public Asset Management (DIPAM).
DIPAM has completed the sale of a 3.39 per cent stake in GIC Re offer for sale for Rs 2,345.55 crore.
In a post on 'X' finance ministry has posted that "DIPAM successfully concluded the GIC Re Offer for Sale #OFS, raising Rs 2,345.55 crore by divesting 3.39 per cent of GOI stake"
Following the OFS, the government's shareholding in GIC has reduced to 82.40 per cent.
The divestment process for GIC Re began on September 4, 2024, in the non-retail category and was met with an enthusiastic response, being oversubscribed by 108.49 per cent on the same day, known as 'T Day.'
Owing to the strong demand from institutional investors, the Green Shoe option was exercised, increasing the total number of shares offered. The transaction was completed on September 5, 2024.
This OFS marked a milestone as it was the first-ever instance where employees were allowed to participate in the main OFS by bidding on T+1 day alongside retail investors under a newly introduced "Employee" category.
DIPAM highlighted the robust interest shown by institutional investors and the smooth execution of the sale. The success of the GIC OFS is part of the government's ongoing efforts to meet its divestment targets and improve public sector efficiency by monetizing assets in a transparent manner.
The government also shared that this year it successfully launched an Offer for Sale (OFS) for 2.5 per cent of the paid-up equity of Cochin Shipyard Limited on October 16, 2024. The Green Shoe option was exercised, allowing the sale of additional shares beyond the base issue size. The transaction generated Rs 2,015.32 crore, reducing the government's stake in CSL from 72.86 per cent.
Another successful OFS involved Hindustan Zinc Limited, where the government divested 1.6168 per cent of its equity, including an oversubscribed Green Shoe option, above the base size of 1.25 per cent. This generated Rs 3,449.18 crore, further reducing the government's holding in HZL from 29.54 per cent.
In a move to promote renewable energy, NTPC Green Energy Limited, a subsidiary of NTPC, was listed on November 27, 2024. Funds raised from the listing will enable NGEL to invest in green energy projects, supporting India's renewable energy goals.
The government approved the strategic disinvestment of Ferro Scrap Nigam Limited (FSNL), a 100 per cent subsidiary of MSTC Limited under the Ministry of Steel. Konoike Transport Co. Ltd. emerged as the highest bidder with a Rs 320 crore offer, surpassing the reserve price of Rs 262 crore.
The sale involves 100 per cent equity and transfer of management control. With the transaction now at its concluding stage, this marks another milestone in privatization efforts.
These disinvestment initiatives were supported by a robust consultative mechanism, including the Inter-Ministerial Group, Core Group of Secretaries on Disinvestment, and the Alternative Mechanism under the Cabinet Committee on Economic Affairs.
In 2024, the government's strategic approach to asset monetization not only brought in substantial revenues but also aligned with broader goals of fostering efficiency, encouraging private investment, and supporting sustainable energy initiatives.