DoT in talks with MoF to split TCIL’s IPO into fresh equity and divestment

The Department of Telecommunications (DoT), in consultation with the Ministry of Finance, is planning to split an initial public offering (IPO), which includes the sale of a 25 per cent stake in Telecommunications Consultants India Limited (TCIL), into two parts. In this regard, TCIL would have to raise funds by issuing 10 per cent fresh equity shares and the government would have to divest 15 per cent of its equity in the company. The TCIL issue is expected to take place during the July-September quarter of 2019. As per the Department of Investment and Public Asset Management rules, in case of an issue of fresh equity in conjunction with the sale of government stake (piggyback transactions) for listing, Cabinet Committee on Economic Affairs (CCEA) approval needs to be obtained by DoT. According to industry sources, the IPO may mobilse Rs 6 billion, which would be used to fund TCIL’s expansion plans and its US subsidiary. Moreover, the government’s share sale is expected to fetch around Rs 10 billion.

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