Empowered Group of Ministers is expected to meet shortly in order to consider disinvestment of Bharat Heavy Electricals Ltd. (BSE:500103) (BHEL) through the block deal route. According to the news report, the stake sale dilution is expected to bring INR 13 billion-INR 15 billion. The government is planning to offload 5% stake.

The Finance Ministry aims to complete the stake sale by March 31, 2014. Post closing of a possible transaction, government's holding in BHEL will come down to 62.72%. From the Budget estimate of INR 400 billion, the Ministry has revised downwards the amount it hopes to mop up through disinvestment in Central Public Sector Enterprises at INR 160.27 billion.

A senior Government official said in order to identify willing buyers, discussions will be held with financial institutions such as Life Insurance Corporation of India, IFCI Limited (BSE:500106), India Infrastructure Finance Company Limited, State Bank of India (BSE:500112) and other nationalized banks, besides General Insurance Corporation of India, National Insurance Company Ltd. and The New India Assurance Company Limited. The Cabinet Committee on Economic Affairs approved a 5% disinvestment in BHEL. This was to be done through the auction or offer-for-sale methods.

However, the Heavy Industries Ministry vetoed the proposal saying the current market situation is unfavorable and offloading in the market will further depress the share prices. BHEL shares closed at INR 150.5 on February 21, 2014.