The government is likely to launch financial tenders for Shipping Corporation of India by September, after the process to spin off non-core assets is completed, an official said.
As part of the strategic sale process, the government is parting with Shipping House and the Pune Training Institute, along with other non-core assets of Shipping Corporation of India (SCI).
“The splitting process takes time. We would be ready to solicit financial offers in 3-4 months,” the official said.
Shipping Corp’s board of directors met last week and approved an updated spin-off plan to divest SCI’s non-core assets to Shipping Corporation of India Land and Assets Ltd (SCILAL), including Shipping House , Mumbai and MTI (Maritime Training Institute), Powai finalize the process of spinning off all non-strategic assets into the new company SCILAL.
According to SCI’s balance sheet, the value of non-core assets held for the spin-off as of March 31, 2022 stood at Rs 2,392 crore.
The SCI board in August last year had approved a spin-off plan to separate the identified non-core assets and incorporated SCILAL in November 2021, to hold those assets of the company, which falls under the Ministry ports, shipping and waterways.
In April 2022, the ministry had ordered SCI to expedite the process of spinning off non-core assets from SCI to SCILAL and also instructed SCI’s board to review the spin-off program to separate non-core assets, including including Shipping House, Mumbai and MTI, Powai.
“These amendments have no impact on the carrying value of non-core assets in the financial statements. Implementation of the scheme, including the amended scheme, is ongoing and given the reiteration by MoPSW and DIPAM of ‘accelerate the demerger process, there is certainty of completion of the process in the near future’, according to the report of SCI’s independent auditor presented to the board of directors.
In March last year, the government had received several offers for the privatization of Shipping Corporation of India.
The Department of Investment and Public Assets Management (DIPAM) in December 2020, had issued a Call for Expression of Interest (EoI) for the strategic divestment of its entire 63.75% stake in Shipping Corp of India, as well as the transfer of management.
The Cabinet, in November 2020, had given its approval in principle to the strategic divestment of Shipping Corp.
The privatization of SCI should now be completed during the current financial year. The government has planned to raise Rs. 65,000 crore from CPSE divestment in the current financial year 2022-23.
While the government has already raised Rs 3,000 crore from the sale of minority shares in ONGC, another Rs 21,000 crore is said to come from the ongoing IPO of Life Insurance Corporation this month and Rs 211.14 crore after transfer of management control from Pawan Hans to Star9 Mobility Pvt Ltd. , a consortium of Big Charter Pvt Ltd, Maharaja Aviation Pvt Ltd and Almas Global Opportunity Fund SPC, by June.
(Only the title and image of this report may have been edited by Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
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