The Telegraph
Since 1st March, 1999
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Selloff Saturday to debate theory, set milestones

Mumbai, Sept. 5: Saturday’s meeting of the Cabinet Committee on Disinvestment (CCD) will consider a key proposal to keep public sector companies out of disinvestment.

The issue will be added to the agenda, which will largely be devoted to debating the sale of Bharat Petroleum Corporation and Hindustan Petroleum Corporation.

Billed a “Super Saturday” by merchant bankers who have kept their eyes glued to disinvestment, the meeting — dogged by differences that have delayed a decision for weeks — will also lay selloff milestones. This will start from appointment of merchant bankers to dates of share purchase to the shareholders’ agreement.

Union minister for disinvestment, Arun Shourie, said one of the things the Cabinet panel will take is the proposal that no PSU should be allowed to bid for another. “Among the four to five items on the agenda are the recommendations by the core group of secretaries, headed by the Cabinet secretary, that no PSU should be allowed to bid for another PSU,” he said here today.

Speaking to reporters on the sidelines of a function organised by the Indian Merchants’ Chamber (IMC), Shourie said barring state-owned firms was only a suggestion, which could be rejected or accepted by the Cabinet. If it goes through, Oil and Natural Gas Corporation and Indian Oil cannot enter the fray for BPCL and HPCL.

Setting milestones for each disinvestment proposals, the minister said, was important as well, given the efforts to draw up a selloff calendar.

The move to calibrate selloff within a time-frame was prompted by Deputy Prime Minister L. K. Advani, who wants the government to stick to schedules, Shourie said.

Asked if the sale of HPCL and BPCL will spawn a monopoly given that Indian Oil already has 55 per cent of the market, the minister said the fears are misplaced.

About the communication ministry’s intention to merge MTNL with BSNL and whether it would affect their disinvestment, he said: “They do not figure on the list at all. They have not come for discussions and the government has not taken a decision on this so far.”

UTI props

Shourie said he was not sure if the bailout package for UTI and SAIL will help restore their financial health. “Despite the financial assistance for a revamp, there will be no change in the style of functioning of these entities,” he said.

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