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Maharashtra may clear MSEB unbundling package today

Renni Abraham  |  Mumbai 

Faced with a now or never situation, the Maharashtra cabinet is set to clear the unbundling package for the (MSEB) on Wednesday.
This will see the creation of four distinct entities whose shares will be held by one holding company.
An interesting aspect will be the asset distribution of MSEB's landed properties among the five companies, since their current valuation stands depressed in comparison to market assessments.
The valuation of the assets will be undertaken after six months and the state government will add a rider to its unbundling decision so that it may review the assets distribution mechanism after six months to a year, when the true value of the assets is clearly known.
"The MSEB balance sheets evidence a sub Rs 5 crore equity held by the Maharashtra government, even as it sits on thousands of crore worth of landed properties across the state. The true valuation of all its assets is going to be an engaging process in the coming months and our technical consultants will be focusing on it as soon as the unbundling process begins," a senior politician said.
The four entities will individually handle generation, transmission, distribution and marketing, respectively, as autonomous companies. These will be controlled by a single holding company created for the purpose.
A well-placed source said, "Even the consultants (Pricewater Cooperhouse) have indicated to the state government that if the unbundling decision does not come about now, it is unlikely that the state will be able to meet the June 10, 2005 deadline for completing the same."
He added that state finance minister is scheduled to go on a three-week foreign visit later in the week after which, chief minister Vilasrao Deshmukh will also be out of Maharashtra.
"The fact is that after the cabinet gives the go ahead for the unbundling process, the distinct four entities so created will have to be registered as individual companies. This process in itself will take some days," the source revealed.