According to source-based information, government postponed the proposed disinvestment in development finance institution IFCI until such time its financial position is strengthened.
The government took this move as it feels that in the present situation, it may not be able to fetch the correct price for its stake if it goes for disinvestment.
It may be recalled that the government asked Atul Rai, head of IFCI, to resign and appointed its own official as interim head of the financial institution.
As part of the government’s plan to boost the finances of the firm, it appointed Ministry of Finance Joint Secretary Anurag Jain as the interim chief executive officer of IFCI.
In a sign of deteriorating finances of the firm, IFCI reported Rs 150-crore profit in January-March quarter, down 31.6 percent from the year-ago period.
The government had acquired a majority stake in the company last year after it converted its Rs 923 crore debt into equity, a proposal that had been opposed by Rai.
Government has a 55.57 percent stake in the company that was once on a par with the other two development institutions such as ICICI and IDBI, but has fallen by the way side in the last couple of decades.
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