Oil and Natural Gas Corp (ONGC) | ONGC to lose Navaratna tag in rush to launch FPO next month |
Oil and Natural Gas Corp (ONGC), India’s most profitable firm, will lose the coveted Navaratna status and the accompanying financial autonomy in its rush to the Rs 11,500 crore share sale scheduled next month.
The government plans to withdraw both of its directors on the ONGC board to meet the capital market regulator SEBI’s listing norm of having equal number of functional and independent directors to allow Rs 11,500 crore public offering ( FPO )) on April 5, sources said.
The move would, however, lead to ONGC losing its Navaratna status that gives the company board autonomy to approve investment in its projects and of up to Rs 1,000 crore spending in a joint venture company.
According to the norms, a Navaratna board can exercise its limitless powers only when it has government-nominated directors on board. Upon withdrawal of such directors, ONGC will have to seek nod of the Public Investment Board ( PIB )) for any spending of over Rs 100 crore, sources said.
Posted by vijay on Mar 6 2011. Filed under Breaking News. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.
