RINL chairman and managing director PK Bishnoi said, It is long back in 2005-2006, the RINL board approved disinvestment of the company. The earlier UPA government had prepared two lists- one proposing 49% stake dilution of certain government companies and another proposing 25% stake dilution. RINL was put on the second list, although disinvestment was not the earlier governments agenda.
Now that the government is persuading a policy of disinvestments, RINL is supposed to go public. But that would happen only after the government announces a clear disinvestment policy, Bishnoi said. RINL has a paid up equity of Rs 5000 crore, preferential equity of Rs 2900 crore and is currently a zero debt company.
Bishnoi said even as disinvestment might not fetch any additional resource to the company but only create additional resource for the government, RINL might opt for debt, pricing of which would be better if there is a raw material base. The governments 100 days programme is placing RINL as a strategic partner in Orissa Mineral Development Company (OMDC), a Bird Group company, giving it access to 200 million tonne of iron ore.
RINL is also taking over 50% of Mineral and Metal Trading Corporations (MMTCs) holding in Neelachal Ispat Nigam Ltd (NINL), which was earlier supposed to go to SAIL. This holding would also give RINL access to 180 million tonne of iron ore.
RINL, a 3mt steel producing company, expanding its capacity to 6.3mt by 2010, does not have any captive iron ore resource so far, although it earlier tried a buy out of the National Mineral Development Corporation (NMDC) to create a captive raw material base.
Bishnoi said while partnership with OMDC and stake holding of MMTC would give it a raw material base, it would also jack up the prices of RINL shares, when goes for public offer.