Indo-Gulf, Sterlite Bid For Hzl

Sterlite Industries Ltd and AV Birla group company Indo-Gulf today submitted financial bids for the government's 26 per cent stake in Hindustan Zinc Ltd (HZL). Binani-Korea Zinc and Glencore, however, opted out of the race on the last day of bidding.

The bids were evaluated at the meeting of the core group of secretaries on disinvestment. The government would take a decision on the new strategic partner next week, sources said. The Cabinet Committee on Disinvestment was likely to meet on March 28 to decide on the financial bids, they added.

The government had decided in November to seek fresh financial bids for HZL as the sole bid from Sterlite Industries was lower than the reserve price determined by the disinvestment ministry.

Earlier, the Birla group and Sterlite vied with each other for a majority stake in Bharat Aluminium Company (Balco). Sterlite, however, bagged Balco with a bid of Rs 551 crore, which was nearly double the second bid. While Binani-Korea Zinc, Glencore and Allied Deals are understood to have kept out of the race for HZL, it could not be confirmed if Metdist too kept out of the bidding process.

The conditions stipulated for bids include a Rs 50 crore earnest money deposit to deter non-serious bidders. The government has also mandated a three-year lock-in period for the strategic partner.

The deposit will be invoked by the government in case the bidder fails to deposit the money. BNP-Paribas is the global advisor for the sale.