MUL divestment put on hold

New Delhi: Sharp declines in the market has led the government to postpone the disinvestment of its residual 10.27 per cent stake in Maruti Udyog Ltd (MUL), the country's largest passenger car maker, to the next financial year. The last date for submitting bids for the purpose was March 9. The postponement has been approved by Finance Minister P Chidambaram.

The decision to disinvest in MUL – the third and final sale of the government's stake — was cleared by the Cabinet Committee on Economic Affairs on 21 December, 2006. The government was to sell 2,96,79,709 shares of Rs5 each through competitive bidding and hoped to raise between Rs 2,400 crore and Rs2,800 crore.

When the decision was taken, the Sensex was at 13,384, with the Maruti scrip at Rs926. Since then, the Sensex touched a high of 14,652 on February 8, before declining to the present level of of 12,430. Maruti share closed at Rs779.4.