The government is planning to sell its residual 18.1 per cent stake in Maruti Udyog to Suzuki Motor Corporation this year instead of offloading it through a public offer.
The Maruti Saga: Complete Coverage
"We have begun deliberations with Suzuki for selling our shares in the company. The talks are, however, at a nascent stage," a senior government official told Business Standard on Tuesday.
The government wants to take advantage of the agreement reached with Suzuki during the first tranche of divestment, which says the government will offer the shares to Suzuki if both agree.
As per the revised joint venture agreement between the government and Suzuki, the put option expires on August 31, 2004.
The government divested a 26.5 per cent stake in the country's largest carmaker in June 2003 for Rs 993 crore (Rs 9.93 billion).
It had earlier raised Rs 1,000 crore (Rs 10 billion) as control premium from Suzuki in 2002, when it renounced its entitlement to a Rs 400 crore (Rs 4 billion) rights issue in favour of the Japanese partner.
The source said the government might benefit from the current boom in the stock market as the share price of Maruti had risen considerably in the past seven months. The Maruti stock is currently hovering around Rs 380 on the Bombay Stock Exchange.
The stock was listed on the BSE in July 2003 at Rs 158.40, a 26 per cent premium over the issue price of Rs 125 per share.
The original book-built public offer comprised 7.2 million equity shares of Rs 5 each. But the government exercised a greenshoe option for another 10 per cent as the issue was oversubscribed more than 10 times.
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