The Rs 6,000 crore follow-on public offering (FPO) of Steel Authority of India (SAIL) will go ahead as per schedule.

?As of now the FPO is on track and should hit the market in mid-February. Unless the markets are very weak, the FPO will happen,? said a person familiar with the development.

Added a SAIL spokesperson, ?There is some minor rescheduling of the roadshows due to important developments in Delhi.?

?Moreover, the issue relating to merchant bankers is being sorted out with SAIL having sought a legal opinion,? said a person familiar with the development.

The government has so far garnered Rs 22,763 crore from the stake sale in its companies in the current fiscal year against the divestment target of Rs 40,000 crore. The disinvestment of the shares of SAIL and ONGC are expected to fetch close to Rs 19,000 crore.

In the cabinet reshuffle, the erstwhile union steel minister Virbhadra Singh was replaced by Beni Prasad Verma.

The spokesperson, however, declined to comment on the replacement of merchant bankers and whether they have replied to the show cause notice sent by the company.

SAIL has sent showcause notices to Kotak Mahindra Capital, HSBC, SBI Capital Markets and Deutsche Bank for their involvement in the follow-on share sale of rival Tata Steel. Questioning the business ethics of these investment banks, the government has asked the bankers to explain their position on managing Tata Steel’s FPO when they were empanelled with state-owned SAIL?s FPO.

Merchant bankers believe there is no ?conflict of interest? in taking on mandates of competing companies citing instances, in the past, when banks have successfully handled mandates of rival companies. The initial public offering of state-run NHPC and private sector firm Adani Power, which took place in August 2009, had three common bankers.

?There is no conflict to the best of our judgment and belief,? Uday Kotak, vice chairman, Kotak Mahindra Bank said at the Tata Steel FPO press conference on Monday. S Vishvanathan, MD and CEO, SBI Capital Markets also, denied any conflict of interest. ?We continue to work actively on the SAIL issue,? he said.

Bankers are readying their defence and will soon file a reply to the steel ministry.