The Union Ministry of Finance on Friday said a ministerial panel empowered by the Cabinet Committee on Economic Affairs has approved the sale of the government's stake and transfer of management control of Pawan Hans Limited to Star9 Mobility Private Ltd.
The Alternative Mechanism, empowered by the Cabinet Committee on Economic Affairs, comprising Nitin Gadkari, Union Minister for Road Transport and Highways, Nirmala Sitharaman, Union Minister for Finance & Corporate Affairs and Jyotiraditya M Scindia, Union Minister of Civil Aviation, has approved the highest bid of Star9 Mobility Private Ltd for sale of entire GoI's shareholding (51 per cent of shareholding) of Pawan Hans Limited (PHL) and transfer of management control, the ministry said in a statement.
Pawan Hans Limited is a joint venture of GoI and ONGC providing helicopter and aero mobility services. The Government of India holds 51 per cent of the shares in the company and ONGC holds the balance 49 per cent. ONGC has earlier decided to offer its entire shareholding to the successful bidder identified in the GoI strategic disinvestment transaction, on the same price and terms as GoI.
The Cabinet Committee on Economic Affairs had approved the strategic disinvestment of entire GoI stake in PHL in October 2016. The transaction had been attempted thrice in the past. In the first round, the Preliminary Information Memorandum (PIM) was issued on 13 October 2017 seeking Expressions of Interest (EOI). Out of four EOIs received, only one was found eligible and the transaction was cancelled.
In the second round, PIM was issued seeking EOIs on 14 April, 2018 and two bidders were found eligible and were issued the Request for Proposal (RFP). Finally, however, a single, incomplete bid non-compliant with the RFP was received. In the third round, PIM was issued seeking EOIs on 11 July 2019. Out of four EOIs received, only one was found eligible and the process was cancelled.
This is the fourth iteration with request for Expressions of Interest (EoI) invited on 8 December 2020. Seven EoIs were received and four interested bidders were shortlisted as qualified bidders. After detailed due diligence, the qualified bidders were invited to submit financial bids. Three financial bids were received.
As per extant procedure, the Reserve Price for sale of 51 per cent shareholding of PHL was fixed at Rs 199.92 crore, on the basis of valuation carried out by experts (transaction adviser and asset valuer). Thereafter, the three bids were opened in the presence of the bidders. All three bids were found to be valid.
M/s Star9 Mobility Private Ltd, a consortium of M/s Big Charter Private Limited, M/s Maharaja Aviation Private Limited and M/s Almas Global Opportunity Fund SPC; emerged as the highest bidder quoting Rs 211.14 crore, which was above the Reserve Price. The other two bids were for Rs 181.05 crore and Rs 153.15 crore. Following due deliberations, the financial bid of M/s Star9 Mobility Private Limited has been accepted by the Government, the ministry said.
The strategic disinvestment transaction was implemented through an open, competitive bidding process supported by a multi-layered consultative decision making mechanism involving Inter Ministerial Group, Core Group of Secretaries on Disinvestment and the empowered Alternative Mechanism.
The transaction now moves to the concluding stage. The next steps are issuing of the Letter of Award, signing of the Share Purchase Agreement and closing of the transaction.
( With inputs from ANI )
Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor