After many failed attempts, govt tries its luck again at selling Pawan Hans

Experts say finding a buyer for the company will be a challenge even as it holds value in the oil and gas sector

The government has once again invited expressions of interest (EoIs) from bidders to sell its 51 per cent stake in Pawan Hans Ltd, after repeated attempts have failed to get a buyer. Experts said finding a buyer for the company will be a challenge even as it holds value in the oil and gas sector. 

Interested buyers will have to submit EoI electronically by January 19, and will also have the option to buy entire 49 per cent stake held by Oil and Natural Gas Corporation in the helicopter service provider on similar price and terms, said the preliminary information memorandum issued by Department of Investment and Public Asset Management.

The suitors should have a minimum net worth of Rs 300 crore to be eligible to make bids, and will have to ensure the company continues its business of providing air transport services on a going-concern basis for three years.

Bids placed by management or employees of Pawan Hans directly or through a consortium with a bank, venture capitalist or a financial institution will be considered. Public sector enterprises will not be allowed to bid. The condition of the sale remains the same as earlier, said Mark D Martin, founder and chief executive officer at aviation consulting firm Martin Consulting.

Given the post Covid-19 financial environment, the government will continue to face challenges to get a new buyer even after five failed attempts, said Martin. However, he added that Pawan Hans is of tremendous value given its strategic importance in the oil and gas industry.

The Rohini Heliport of the company will not be a part of the transaction, and will be demerged from Pawan Hans into Rohini Heliport Ltd. The demerger process is underway. process of Rohini Heliport from PHL is underway.

 

The company has been reporting losses the past two years, and has seen decline in revenues and increase in total expenses. Its operating margins have also eroded over the years from over 35 per cent in 2015-16 to 21.5 per cent in 2017-18.