financial bids for Pawan Hans Disinvestment The transaction has been received by the advisor. The process has now moved to the final stage,” tweeted Dipam secretary Tuhin Kanta Pandey.
However, he did not disclose the number of bidders.
The financial bids for Pawan Hans Limited Disinvestment were received by the Transaction Advisor. The process is now nearing completion… https://t.co/dhi3obP0wg
— Secretary, DIPAM (@SecyDIPAM) 1639742701000
The government is selling its entire 51 per cent stake in Pawan Hans. State-owned Oil and Natural Gas Corporation (ONGC), which holds the remaining 49 per cent stake, has also offered for sale its entire stake in the company along with the government stake.
Established in 1985, Pawan Hans has a fleet of over 40 helicopters and over 900 employees, of whom less than half are in permanent roles. It provides helicopter services to ONGC’s exploration activities and Northeast of India.
For 2019-20, the company reported a net loss of Rs 28 crore, down from Rs 69 crore in the previous year. It had an authorized capital of Rs 560 crore and a paid-up share capital of Rs 557 crore as on March 31, 2020.
In 2018, the government had invited bids to sell its stake in Pawan Hans. However, ONGC withdrew the process after it decided to sell its 49 per cent stake in the company with the government. In 2019, a second attempt was made to sell the company, but it failed to elicit a response from investors.
Last year, the government sweetened the conditions for potential bidders by reducing the minimum net worth and lock-in period of investment and allowing the successful bidder to sell the property after one year. Previously, the terms of the sale allowed the successful bidder to own the assets for two years after the acquisition.
In addition, change in shareholding was allowed among consortium partners, provided the principal investor held a minimum of 26 per cent and other members held at least 10 per cent. The lock-in period for investments was also reduced to one year from three years earlier.
However, a new section of business continuity was added to ensure that the successful bidder would not close or cease business for three years. The minimum net worth of the bidders has also been reduced from Rs 350 crore to Rs 300 crore and the profitability criteria have been done away with to increase the universe of bidders.
In February this year, the government received several preliminary bids for privatization Process. Thereafter the bidders have done due diligence of the company and have now submitted financial or price bids.
The disinvestment is part of the revenue mobilization target of Rs 1.75 lakh crore set by the government for the financial year 2021-22 (April 2021 to March 2022). So far, the government has raised Rs 9,330 crore through the sale of minority stake.
In October, the government sold Air India Tata Group First major privatization move in nearly two decades, at an enterprise value of Rs 18,000 crore. The government will get Rs 2,700 crore in cash from Tata for the sale of its 100 per cent stake.
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