RBB urges corps to help offload cross-holding of NIBL, NHFC promoter shares

ShareSansar, June 23:

As the state-run Rastriya Banijya Bank (RBB) could not off load more than 58 lakh units of promoter shares of Nepal Investment Bank Limited (NIBL) and Nepal Housing Finance Company Limited (NHFC) despite repeated attempts, it is now urging public corporations to help square off those scrips.

RBB had failed to attract buyers to auction 56.52 lakh units of NIBL and 1.96 units of promoter shares of NHFC despite extending the deadline for filing applications for three times and making the bidding process more flexible since late last year.

According to RBB’s Chief Executive Officer Krishna Prasad Sharma, they have been approaching Nepal Telecom, Rastriya Beema Sansthan, Employees Provident Fund and Citizen Investment Trust to buy the promoter shares of NIBL and NHFC, which it has not been able to divest.

“The talks with these corporations are moving ahead positively,” he said, adding that they hope to offload these promoter shares at the earliest.

Even if we cannot strike a deal with these corporations, too, offload the cross-holding, it will divest it in retail in price lower than the last minimum price set for the scrips, he further informed.

RBB had set the minimum bid price at Rs 594 for NIBL promoter share and Rs 101 for NHFC promoter share during the last auction notice  earlier this month.

The central bank has been strongly directed the BFIs to end  cross-holding, and has warned that any BFI which does not do so will have to hold barred from getting cash and stock dividend and buying rights shares. The dividend would be released only after all the cross-holdings ends.

RBB has been desperately trying to offload the cross-holding as it has also not been able to receive Rs 14 crore in cash or 25 percent cash dividend from NIBL due to the central bank’s directive. Similarly, the central bank has also withheld its dividend from NHFC.