Divestment: CIL to help employees open demat accounts

The country's largest coal producer Coal India on Thursday said it will facilitate opening of demat accounts for its 4 lakh employees to ensure their participation in the upcoming public issue which is likely to fetch around Rs 12,000 crore (Rs 120 billion) to the government.

"We will help open demat accounts for our nearly 4 lakh employees through State Bank of India and other banks because we want their participation in the share sale," the state-run Coal India chairman Partha S Bhattacharyya told PTI.

"These are the services banks normally provide free of cost so there would not be any financial implications on the company," he said, adding involving workers in stake sale will give them a sense of belonging to the company.

The government proposes to offload 10 per cent equity in the coal monolith by July-August, which could fetch the exchequer Rs 10,000-12,000 crore, depending on the issue price.

The government plans to disinvest 10 per cent stake in CIL through an IPO, out of which 9 per cent would be channelised through the IPO and the rest would be sold to employees.

The Centre holds 100 per cent equity in CIL. The share sale is likely to happen through the book-building route. On price band of the issue, Bhattacharyya said the same would be decided by the group of ministers.

"Reports about company fixing the price band of the issue is totally baseless. It will be decided by the GoM," he said.