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Govt floats PIM for strategic disinvestment of Pawan Hans

This will be the Centre’s second attempt to sell Pawan Hans after 2018, when it had to withdraw its offer as it could not find suitors

This will be the Centre’s second attempt to sell Pawan Hans after 2018, when it had to withdraw its offer as it could not find suitors.
This will be the Centre’s second attempt to sell Pawan Hans after 2018, when it had to withdraw its offer as it could not find suitors.
  • According to a notification released by DIPAM, any domestic or global player can submit an EoI by January 19 and the list of shortlisted bidders will be revealed on February 17

  • Oil and Natural Gas Corporation Ltd (ONGC) has also decided to offer its entire shareholding of 49 per cent in PHL to the successful bidder

New Delhi: The Centre has floated a preliminary information memorandum (PIM) and invited Expression of Interest (EoI) for the strategic disinvestment of its stake in Pawan Hans Limited (PHL). According to a notification released by the Department of Investment and Public Asset Management (DIPAM) on Tuesday, any domestic or global player can submit an EoI by January 19 and the list of shortlisted bidders will be revealed on February 17. This will be the Centre’s second attempt to sell the PSU after 2018, when it had to withdraw its offer as it could not find suitors. 

“The GOI has ‘in-principle’ decided to disinvest its entire equity shareholding in PHL by way of strategic disinvestment (“Strategic Disinvestment”) to investor(s) along with transfer of management control. Department of Investment & Public Asset Management (“DIPAM”) on behalf of GOI will conduct the Transaction and has appointed SBI Capital Markets Limited (SBICAP) as its advisor (“Advisor” or “Transaction Advisor” or “TA”) to advise and manage the Strategic Disinvestment of PHL (“Proposed Transaction” or “Transaction”),” the DIPAM notification said.

ONGC to offer its entire shareholding of 49% in PHL

According to the PIM, Oil and Natural Gas Corporation Ltd (ONGC) has also decided to offer its entire shareholding of 49 per cent in PHL to the successful bidder at the same discovered price per share and on same terms and conditions as agreed by the Centre, except for the rights available exclusively to it. The successful bidder, as identified by government, will have the option to buy entire ONGC stake of 49 per cent in PHL on similar price and terms.

“The IBs may submit the complete EOI in electronic form via email at phl@sbicaps.com with all the requisite documents in PDF format by the Due Date. The PDF files should be password protected and the password should be communicated via a separate email at phl@sbicaps.com. IBs submitting EOI by email shall also be required to submit the EOI in a physical copy not later than 5:00 PM (Indian Standard Time) of February 03, 2021,” the PIM said.

Pawan Hans Limited (PHL)

Pawan Hans Limited is a Mini-Ratna Category-I CPSU under the Ministry of Civil Aviation to provide air transport services for exploration activities of ONGC and helicopter transportation services to the North-East region etc. While the Centre holds 51 percent in the company, the rest 49 percent is owned by ONGC. The PSU’s authorised capital as on March 31, 2020 is Rs 560 crore (5,60,000 equity shares of Rs 10,000 each). 

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As of now, the company has 42 helicopters in its fleet. However, average monthly deployment is 30.

The company has been making losses for the last two financial years. It posted a net loss of Rs 69.20 crore in FY2018-19 and earned Rs 414 crore. In FY2019-20, the net loss dropped to Rs 28 crore while the total revenue came down to Rs 376.82 crore. The PIM said that the PSU’s revenue declined in Fy2019-20 due to ageing of helicopters as vintage clauses enforced by various customers act as a hurdle to participating and winning new businesses. As on March 31, 2020, out of 42 helicopters, five helicopters were under impairment (cannot be repaired as their spares are not available) and one has been dispatched for overhaul to Russia, the PIM said.

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