Sebi today gave its nod for the Tamil Nadu PSUs to buy 3.56% stake for Rs 500 cr
NLC Nalco India Lt
The striking workers at the Neyveli Lignite Corporation (NLC), the largest Navratna Public Sector Undertaking, have decided to withdraw their indefinite strike, that lasted 13 days, after the Securities and Exchange Board of India (SEBI) gave its nod for Tamil Nadu PSUs to buy 3.56% stake for Rs 500 crore.
The strike, which started on July 5th was withdrawn within hours on Monday after Tamil Nadu Chief Minister J Jayalalithaa said, at a meeting in Mumbai, that the Central Government and the SEBI have agreed to the State Government’s proposal to buy portion of Centre's stake through four state PSUs.
She said PSUs will be spending around Rs 500 crore to buy this stake. The PSUs include Tamil Nadu Industrial Development Corporation (TIDCO), State Industries Promotion Corporation of Tamil Nadu Limited (SIPCOT), Tamilnadu Industrial Investment Corporation Limited, Tamil Nadu Urban Finance & Infrastructure Development Corporation Limited (TUFIDCO) and Tamil Nadu Power Finance & Infrastructure Development (Powerfin)
The Unions include ruling AIADMK-backed Anna Workers & Staff Union, other major Unions participated in today's meeting including DMK's, which was a key partner of Congress government, CITU, PMK, LLF and others. Several members of these Unions have also confirmed the decision.
These unions, representing around 17,500 workers in NLC, have said they would force a shut-down of operations to prevent the inclusion of private investors in the ownership of the company, as it would lead to job losses and erosion of worker rights in the company, a trade union leader said.
The Unions did not accept Government stand that the basic ownership structure, which saw government being the single largest shareholder, with a 93.5% stake, would change only marginally following the offloading of five% of equity to private investors.
Udayakumar said “today the stake sale is five%, if we leave it step by step it will go upto 43%, we will loose our allowance, rights, jobs and everything. We dont want this to happen”.
S Rajavannian, general secretary of NLC Labour Progressive Federation, affiliated to DMK, said that the company has so far given out Rs 2000 crore as dividend. For instance in 2011-12 alone the dividend was Rs 470 crore and in 2012-13, it is expected to be around Rs 500 crore.
“The company has been profitable from 1977 and compared to the dividend it gives yearly, the sales of 5% would only fetch around Rs 466 crore,” he said. The Federation would be holding strong protest against the issue and also would look at agitations if the government goes on with its decision, he said.
It may be noted two previous attempts to divest NLC shares to private investors, in 2002 and 2006, had to be aborted due to the pressure from trade unions and from the State Government.