The Telegraph
Since 1st March, 1999
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Divestment in 24 PSUs put on fast track

New Delhi, May 24: The BJP-led government has decided to sell a total of 24 state-run companies, putting on fast forward its plan to sell off Balmer Lawrie, Burn Standard, Bharat Petroleum Corporation Ltd (BPCL) , Engineers India, EPIL, Hindustan Organics, Shipping Corporation, Hindustan Copper and a clutch of ITDC hotels.

At the same time it is soft-pedalling on the controversial sale of Hindustan Petroleum Corporation Ltd, in the face of strong objections from top BJP leaders.

Top disinvestment ministry sources said it was going on a fast-forward mode on these medium-sized companies as they were considered “safe” to sell and were likely to attract only local opposition and not the kind of nationwide hue and cry that would emerge if a company like HPCL is sold off.

Disinvestment minister Arun Shourie is already in trouble with his party’s top brass over trying to bypass party directives that he should go slow on the HPCL selloff. Despite being warned not to touch big ticket disinvestments in an election year, Shourie had been quietly continuing with the process of disinvestment in HPCL, by inviting expressions of interest in the oil major from strategic bidders. Sources say that among those who have bid are Royal Dutch, Reliance and Totalfina.

But he has in the recent past been warned not to rock the boat and he has accepted that directive. His ministry has been told to drag its feet on HPCL.

However, at the same time, he has been allowed to go ahead with those sales which will not affect the Assembly elections to four north Indian states.

The sales this year alone are expected to fetch over Rs 8,000 crore, even if HPCL is not sold off.

“Shortlisted parties for Balmer Lawrie, whose sale is an issue only in West Bengal, have finished their due diligence. Their comments on draft transaction documents are now being considered by the inter-ministerial group,” officials said.

The government wants to sell off 61.8 per cent stake in the Calcutta-based conglomerate which has interests in leather chemicals, tea, travel and containers, as a single entity on an is where is basis. Among those who bid for the firm are Patton, Gujarat Glass and Srei International.

Shipping Corporation of India, a firm which the government earlier had reservations about selling, will be finally put on the block. Transaction documents for the shipping line are being “frozen” which means that they have been finalised and financial bids will be called for soon.

In the case HOCL, those parties who have responded to a short bid will be shortly completing their due diligence after which final bids will be taken. Similarly, in the case of Burn Standard, the government is going ahead with processing of expressions of interest, despite objections made by unions and officers associations on a host of grounds.

Sale of Engineers India also similarly awaits certain clearances from Sebi on its listing requirements, otherwise transaction documents have been firmed up. Engineering Projects India Ltd will be reducing its paid-up capital after which it too will be sold off as its transaction documents have been cleared.

State Trading Corporation is another company where due diligence has been completed by interested bidders and transaction documents are being finalised. But the BJP government is not yet sure whether to sell this firm off as yet or not and are studying whether it could create political problems for it.

However, Hindustan Copper, which is in the same sticky situation as STC as far as the processing of its selloff is concerned, will be divested quickly as there are not likely to be any major political objections to its sale.

Four hotels — Hotel Jaipur Ashok, Kalinga Ashok, Neelanchal Ashok and the unfinished Anandpur Sahib Ashok — will also be sold off at the earliest.

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