Coal India to buy back 10.89 cr shares worth Rs 3,650 cr
State-run Coal India Ltd said its board has approved buyback of 10.89 crore shares worth Rs. 3,650 crore. The company by way of special resolution has approved the buyback of not exceeding 10.89 crore equity shares of the company at a price of Rs. 335 per equity shares payable in cash for an aggregate consideration of Rs. 3,650 crore. The Finance Ministry is pushing for buyback of shares by Central public sector enterprises (CPSEs). This is being done for two purposes —to generate cash for the Government and help push the valuation for any divestment. In the last one year, CIL has seen depletion in its cash reserve by 18 per cent or Rs. 8,700 crore to Rs. 38,300 crore as on March 2016. The Government has set a disinvestment target of Rs. 56,500 crore for 2016-17. Of this, Rs. 36,000 crore is expected to come from minority stake sales. CIL board will deliberate on cash outgo due to the buyback and its long-term investment plan to meet Coal Ministry’s target of one billion tonne output by 2020.