The government has sold out its 26.12% stake in Tata Communications Ltd (TCL) and raised Rs 8,846 crore. With this the government is getting closer to the revised disinvestment target for FY21.

The Union finance ministry for the financial year 2021 has reduced the disinvestment target to Rs 32,000 crore from Rs 2.1 trillion. It is due to the disruptions caused by the covid-19 pandemic. With the addition of the proceeds from the sale of its stake in TCL, the government has mopped up Rs 31,006 crore already.

For the FY22, the government has set the disinvestment target of Rs 1.75 trillion based on a series of privatizations which includes Bharat Petroleum Corporation Ltd. (BPCL) and Air India, and the initial public offering (IPO) of Life Insurance Corporation of India.

“Disinvestment of government holding completed of 16.12% in TCL through OFS (offer for sale) at Rs 5,457 crore and 10% to strategic partner at OFS discovered price for Rs 3,389 crore. With this, the government exits from TCL with total proceeds of about Rs 8,846 cr," Department of Investment and Public Asset Management (DIPAM) Secretary Tuhin Kanta Pandey said on Twitter.

DIPAM had set a floor price of Rs 1,161 per share for the stake sale that began on 15 March.

“The government’s exit from TCL gives a clear message that we are not there to squat. We got tremendous amount of value addition. The timing was also important. Within one year, the stock has gone up four times," a finance ministry official said on condition of anonymity, as per news source.

The TCL sale marked the government’s exit from the erstwhile Videsh Sanchar Nigam Ltd. (VSNL), a central public sector enterprise that was privatized in 2002 by divesting a 25% shareholding along with transfer of management control to Panatone Finvest, named the strategic partner. Subsequent to the disinvestment, VSNL was renamed TCL.