India offers Balco stake to Sterlite for $416 mln-paper

MUMBAI, Aug 14 (Reuters) - The federal government will offer its 49 percent stake in Bharat Aluminium Co (Balco) to Sterlite Industries (India) Ltd for about 20 billion rupees ($416 million), the Economic Times reported on Friday, citing a finance ministry source. The deal, if it closes, will settle a five-year dispute over the valuation, the paper said, adding the government would make the offer before a three-member arbitration panel. The panel is expected to meet in the last week of this month. Sterlite had bought a 51 percent stake in Balco from the government in 2001 for 5.51 billion rupees and had an option to buy the remaining by March 2004. But when it tried to exercise the call option, difference cropped up over the valuation. Officials at Sterlite, part of India-focussed mining group Vedanta, could not be reached for comment immediately by Reuters. ($1=48.1 rupees) (Reporting by Narayanan Somasundaram; Editing by Himani Sarkar)