New Delhi, March 4 (PTI): The disinvestment ministry has stipulated a three-year lock-in period for bidders in Hindustan Copper where the government proposes to shed its entire equity.
The move assumes importance in the light of the controversy over the Centaur Hotel deal where the original owners, Batra Group, had resold the property to Sahara for a profit.
Official sources said the decision to impose a lock-in clause was needed as the company was engaged in mining of copper employing over 6,500 people.
They said that the idea behind the sale was to enable the company to grow while preserving employment. Therefore, a clause to this effect was needed.
The government currently holds a 98 per cent stake in the copper major while the balance is with the public. It proposes to offload its entire equity to a strategic partner along with management control. A F Ferguson has been mandated as global adviser for the deal.
Last month, the core group of secretaries had approved a proposal to freeze the transaction documents for the sale. The documents would now be taken to a cabinet committee on disinvestment for finalisation prior to calling of financial bids.
Last year, an attempt at privatising the company had failed due to lukewarm response from bidders citing the poor financial health of the company.
The government had agreed to a round of restructuring in the form of a Rs 440-crore package which involved an extension of the guarantee against loans raised from IDBI and further funding for a separation scheme.
The bidders were not enthused and asked the government for a further Rs 500-crore package.