Mumbai, Sept. 30 (PTI): The Maharashtra government (GoM) and Unit Trust of India (UTI), two major shareholders in Sicom Ltd, will together divest a 26 per cent stake in the state-owned entity to a strategic partner, even as Sicom has decided to undertake consultancy and advisory services. “GoM and UTI, which hold 49 per cent and 40 per cent equity respectively in Sicom, have agreed to disinvest 26 per cent between them and the task to find a bank as strategic partner has been entrusted to KPMG,” Sicom chairman R. D. Pradhan said.
Both shareholders were likely to divest an equal stake and the process was expected to be completed by April 2003, he said, adding that roping in a bank as a partner would enable Sicom get funds at a softer interest rate.
Sicom managing director Jayant Kawle said the net worth had been eroded from Rs 232 crore to Rs 162 crore. The entity has, therefore, decided to partially repay (Rs 184 crore) its subordinate loan to the GoM that would shore up the net worth to Rs 277 crore.
Pradhan said they had introduced a voluntary retirement scheme that helped Sicom scale down its staff from 267 to 180. Hinting at a possible second round of VRS, he said the entity was also restructuring available professional staff so as to enable it to undertake consultancy and advisory services and earn more fee-based income. Sicom has already received several proposals in this regard.
The board has also decided to exit the housing finance business and was in talks with United Western Bank (UWB) and several other banks for Sicom Housing.
Pradhan said the entity also faced some problems when it lost its status as a development financial institution and got classified as a non-banking financial company, adding that the Reserve Bank of India gave the entity some transition period.
He said net non-performing assets of Sicom rose from 10.15 per cent to 16 per cent. “We want to bring down the NPAs to less than 10 per cent by April 1 2003,” he added. Sicom has made a provision of Rs 77 crore and undertook writing off of Rs 32 crore of NPAs, he said.
Reducing NPAs would enable the entity to offer a wide range of financial services to several projects of direct benefit to the state, which include the Maharashtra Urban Infrastructure Fund.