Centre kicks off selloff process
In a move to meet its divestment target, the government on Friday invited bids from advisers for sale of its controlling stake in three public sector units (PSUs) — Container Corporation of India (Concor), Neepco and THDC India. The aim of the government’s strategic disinvestment exercise is to meet the fiscal deficit target of 3.3 per cent of the GDP in the year ending March 31, 2020.
The proposals are invited by Nov. 4 from reputed entities with required experience and eligibility.
“The Government of India is considering selection of transaction adviser/legal adviser/asset valuer separately for two strategic disinvestment of Government of India existing paid up equity shareholding in two CPSEs under the administrative control of Ministry of Power,” the Department of Investment and Public Asset Management (Dipam) said while inviting bids.
As far as this divestment exercise is concerned, the government has mobilised Rs 12,357.49 crore so far during the current financial year, according to data available by Department of Investment and Public Asset Management (DIPAM). However, the government is targeting to mobilise Rs 1.05 lakh crore from its disinvestment proceeds.
It has been analysed that though achieving this target, the government may face more critical situation after it doled out Rs 1.45 lakh crore stimulus by way of a cut in corporate tax.
On the proposed bidding, officials, however, said that strategic sale would involve two-stage bidding beginning with an expression of interest (EoI) or a preliminary intent showing bid, and a final financial bid. “Pre-bid meetings with likely bidders and roadshows to attract potential investors will form part of the process to provide clarity on every aspect of the stake sale,” they said.
“Also, a data centre will be set up for bidders to look for information on the PSUs up for sale and the idea is to complete the stake sale within an estimated timeframe of 4-5 months,” they added. Strategic sale would involve two-stage bidding process beginning with an EoI and a final financial bid