The Cabinet Committee on Economic Affairs on Wednesday approved the strategic sale of Neelachal Ispat Nigam (NINL), in which multiple state-owned companies own a stake.
It is learnt that this strategic sale could be completed only after March 31, and hence, will be part of the 2020-21 divestment pipeline.
NINL is a joint venture company, in which four central public sector undertakings — MMTC, National Mineral Development Corporation (NMDC), Bharat Heavy Electricals (BHEL), and MECON — and two Odisha government companies, Industrial Promotion & Investment Corporation of Odisha (IPICOL) and Odisha Mining Corporation (OMC), hold stake.
MMTC holds 49.78 per cent share in NINL, followed by OMC (20.47 per cent), IPICOL (12 per cent), NMDC (10.10 per cent), while MECON and BHEL hold 0.68 per cent each.
The strategic buyer for NINL will be identified through a two-stage auction procedure, said an official statement.
The request for proposals to hire transaction and legal advisors and asset valuers are already on the website of the Department of Investment and Public Asset Management (DIPAM).
As is the norm in strategic sales, the successful buyer will bring in new management, technology, and investment for the growth of the company and for the development of the business operations of the company, which may generate more employment opportunities, it said.
For 2019-20, DIPAM is expected to fall well short of the Rs 1-trillion target. Officials have now made it clear that big-ticket items like the planned privatisation of Bharat Petroleum, Air India, and Container Corporation of India will not happen this year. This will further expand the fiscal slippage.