The raging controversy over the divestment of public sector oil companies notwithstanding, the government completed 25 transactions and added Rs 8,661 crore (Rs 86.61 billion) to its selloff kitty in 2002.

During the current financial year, however, the government is likely to garner only Rs 5,000 cr (Rs 50 billion) from the divestment of public sector units, which is Rs 7,000 crore short of its Budget target of Rs 12,000 crore (Rs 120 billion). The selloff proceeds stood at Rs 3,336 till the end of December, 2002.

The divestment deals that materialised in the past 12 months include IBP Ltd, Videsh Sanchar Nigam Ltd, Indian Petrochemicals Corporation Ltd, Maruti Udyog Ltd, and Hindustan Zinc Ltd, which raked in Rs 8,661.33 crore for the government.

The figure included sale proceeds, special dividends and dividend taxes, a ministry release said.

Other successful deals of the year comprise hotel properties of India Tourism Development Corporation and Hotel Corporation of India Ltd.

These include properties at Madurai, Udaipur, Mamallapuram, Delhi (Ranjit and Qutab) and Mumbai (Juhu Centaur and Airport Centaur).

Ever since the department of disinvestment was converted into a ministry three years ago, 34 transactions have been completed, bringing in Rs 11,300 crore (Rs 113 billion) for the government.

It was against this backdrop that the performance of the ministry assumed significance in 2002, the release said.

The ministry also pointed out that the scrips of companies on the disinvestment list rose sharply, as much as five times in cases like HMT, during 2002.

In the next few months, the government expects realisations to the tune of Rs 1,442 crore (Rs 14.42 billion) from its divestment process, mainly on account of the initial public offer of 25 per cent equity in Maruti, slated to be completed by March 2003.

Japan's Suzuki Motor Corporation, which acquired management control over Maruti following a fully subscribed Rs 400 crore rights issue, has underwritten the public offer at Rs 2,300 per share. The face value of Maruti's shares is Rs 100 per unit.

Based on Suzuki's commitment, the government will get at least Rs 828 crore (Rs 8.28 billion) from the sale of 3.6 million Maruti shares it seeks to offload through the book-building route.

While merchant bankers are not very optimistic about the government getting a huge premium over the price at which Suzuki has underwritten the public issue, the government hopes to net at least Rs 900 crore (Rs 9 billion) from the process at an assumed price realisation of Rs 2,500 per share.

The divestment of wagon maker Jessop would fetch Rs 18.18 crore (Rs 181 million), once the deal is cleared by the Kolkata High Court. Kanishka and Indraprastha hotels in the Capital would together bring in Rs 135 crore (Rs 1.35 billion), the release said.

In addition, Delhi's Ranjit hotel would yield Rs 29 crore (Rs 290 million) and a semi-finished ITDC property in Chandigarh would add Rs 17 crore (Rs 170 million), it said.