Issue of Fresh Equity Capital by Oil India Ltd. and Listing of the Company’s shares on stock exchanges
The Cabinet Committee on Economic Affairs today gave its approval to the proposal of Oil India Limited for fresh equity issue of 10% of its paid up capital through Initial Public Officer (IPO) to enable the company to get listed on the Stock Exchanges. CCEA has also approved the proposal for issuing of additional 1% of its paid up capital to the employees of OIL. The price/band/floor price and offer price to be approved by the EGoM constituted to decide the price for the sale of Government shares.
In addition to the above, CCEA has approved the divestment of 10% of OIL’s paid up capital in favour of the three Oil Marketing Companies (OMCs) viz, IOC, HPCL and BPCL in the ratio of 2:1:1 respectively. The divestment in favour of three OMCs would not only strengthen their existing synergies but would also help them to raise resources by disposing these shares in the open market at an opportune time to tide over their under-recoveries.
The fresh issue of 10% of its paid up capital would meet SEBI’s requirement of listing of the Company’s share on the Stock Exchanges. This would not only make OIL more amenable to market discipline but would also boost the company’s image. Besides, it would help OIL to raise resources for its future expansion and growth. The additional 1% allocation for its employees would motivate them towards better performance.
The proceeds of divestment of Government holding in favour of IOC, HPCL and BPCL would accrue to the Government and is to be used for meeting the needs of social sector Programmes as also for the Capital investments needs of revivable CPSEs.
Link is being provided for easy reference to OIL India website: