The AIADMK government scored a political victory as the stand-off over disinvestment in Neyveli Lignite Corporation ended and the unions called off their strike. In a move facilitated by the Centre, TN is now set to buy a 3.56% stake in NLC for Rs.500 crore and stall the entry of private investors.
In a first-of-its-kind transaction, the Centre and the Securities and Exchange Board of India made a departure from the normal divestment route and gave their nod to Tamil Nadu to acquire NLC shares through five state-run public sector undertakings.
Chief minister J Jayalalithaa called Prime Minister Manmohan Singh and thanked him for his cooperation in resolving the crisis. An official press release said Singh told the CM that he had always enjoyed a cordial relationship with the TN government. The alacrity with which the Centre responded to TN’s unusual proposal to buy NLC shares set off speculation that the UPA government is cozying up to the AIADMK to build a relationship in the run-up to the Lok Sabha elections.
Responding to a call from Jayalalithaa, NLC employees ended their strike and returned to work.