IPO In BSNL?-inf. by BSNLEU-WTR-MUMBAI

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BSNL staff union open to discussing IPO plans -BSLEU-Opposed IPO
The Hindu Business Line Friday, Jun 05, 2009

New Delhi, June 4 In what could be a softening of stance, the employees union of Bharat Sanchar Nigam Ltd said that it was prepared to discuss the company’s proposal for an Initial Public Offering.

While the union maintained that it was still opposed to the idea of listing BSNL’s shares on stock exchanges through an IPO, its officials said that they were prepared to hear what the management and the Communications Ministry had to offer.

Speaking to Business Line, Mr V. A. N. Namboodiri, General Secretary, BSNL Employees Union, said, “If they call us we are ready to discuss the IPO issue with the Government.”

Govt proposal

Asked whether the union will agree to the proposal if the Government offered them sops in terms of bettering their pay package, Mr Namboodiri said, “We have not come to that stage yet. We will hear what they have to say. So many of the promises made to us by the Government at the time of corporatising BSNL are still to be met. ”

Mr Namboodiri, however, categorically said that there was no change in the union’s stance on the proposed IPO and it would strongly oppose the move. But sources said that the union may push hard some of its long-standing demands related to higher pay, promotion, absorption, allowances, giving ‘maharatna’ status to the PSU, pension and employees stock option. The union may also seek assurances on paper from the Government about the employees’ job status.

Asked why the union was opposing the proposed listing, Mr Namboodiri said, “Look at MTNL, which got listed much earlier. It does not have money to even pay the salaries. And see what has happened to VSNL. The name itself has been changed. What assurances can the Government give that we will not face the same fate after divesting BSNL’s stake,” Mr Namboodiri said.

Actual listing

While the actual listing of BSNL may still be some time away, the fact that the unions have agreed to discuss the IPO proposal could be an opening for the management to negotiate a way out.

The State-owned telecom company had approached the Government last year with a proposal to divest 10 per cent stake to the public in a bid to raise about $10 billion. The company was hoping to use the funds for its expansion. However, the plans got shelved after the unions rejected an offer from the Communications Ministry to improve emoluments. With the unions agreeing to discuss the issue again, this time the BSNL management could sweeten the deal.

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