The finance ministry has sought expressions of interest from interested parties for the ownership and management control of Shipping Corporation of India (SCI).
The Centre plans to sell its entire 63.75 per cent stake in India’s premier shipping line and will accept EoIs till February 13.
Analysts expect Essar Shipping, Adani, Vedanta, GE Shipping and Dubai Port World to participate in the exercise, which could fetch the Modi government around Rs 2500 crore at the current market price.
About 296.9 million shares of SCI are up for sale, which got delayed because of the pandemic. Investors can submit bids individually or as part of a consortium. RBSA Capital Advisors LLP will be the government’s transaction adviser.
Divestment secretary Tuhin Kanta Pandey told television channels that the cabinet will soon take a call on the sale of IDBI Bank. He said a buyer for BPCL can be found in the next six months and Air India bidders would be informed by January 5.
The Department of Investment and Public Asset Management (Dipam) said the interested bidders for SCI should have positive EBITDA (earning before interest, tax, depreciation and amortisation) in three out of the last five years and a minimum net worth of Rs 2,000 crore. In case of a consortium, the lead member should have a minimum net worth of Rs 1,001 crore with at least 50.01 per cent equity in the consortium.
The ultimate beneficial owner for any bidder should not be the same as that of any other bidder or of any consortium member.
“In case of IPs (interested parties) who are funds, the ultimate beneficial owner would mean the investment management entity which manages the investments of the fund and not the investors who have invested in the fund,” Dipam said in the preliminary information memorandum.
The memorandum said certain non-core assets will be hived off from SCI. Further, matters such as the bearing of the Indian flag, employee protection and asset stripping shall be specified in the request for proposal.
SCI is the largest Indian shipping company with a fleet strength of 59 vessels, including crude oil tankers, very large crude carriers, petroleum product carriers, liquefied petroleum gas carriers, bulk carriers, container ships, and off-shore support vessels.
The government plans to set up a development finance institution (DFI) in the next three to four months with a view to mobilise Rs 111 lakh crore required for funding of the ambitious national infrastructure pipeline, according to financial services secretary Debasish Panda.
“We need a development financial institution as infra financing needs patient capital, and banks are currently not suited for lending for long term projects,” he said.