Coal India board on February 4 approved buyback of up to 4.47 crore shares totalling to Rs 1,050 crore at Rs 235 per share.
This is the second buyback by the Maharatna company in two years. CIL had bought back nearly 10.9 crore shares in 2017 at Rs 335 per share. The government garnered approximately Rs 2,638 crore by tendering 8 crore shares in the issue.
The buyback portion accounts for 0.72 percent of the total outstanding equity shares.
The record date to ascertain the eligibility of shareholders to the tender offer route issue is February 15, 2019.
The government is likely to garner Rs 766 crore from the buyback.
The buy back exercise will be conducted in two steps.
Coal India subsidiaries Mahanadi Coalfields Ltd, South Eastern Coalfields Ltd and Northern Coalfields Ltd will buy back their shares worth Rs 355 crore each from the parent.
Thereafter, CIL will buy back its own shares from shareholders out of the free reserves worth Rs 1,065 crore.
Currently, the government holds 72.9 percent in the company, foreign portfolio investors foreign and institutional investors hold about 6 percent, financial institutions/banks/MFs/Alternate Investment Funds hold roughly six percent and insurance companies hold around 12 percent.