Disinvestment Drive: Union Government Invites Bids For Privatisation Of Shipping Corporation of India, To Sell Complete 63.75 Per Cent Stake

The Union government today (Dec 22) invited bids to sell its 63.75% stake in Shipping Corporation of India (SCI) to a private investor.

The deadline for submitting initial bids would be Feb. 13.

The ministerial committee on divestment has cleared the decks for the privatisation of Shipping Corporation of India (SCI) and approved the proposal to invite bids for the same

The committee, which includes Finance Minister, Minister for Road Transport and Highways, and minister representing the respective administrative department, has approved the expression of interest and preliminary information memorandum as proposed by the Department of Investment and Public Asset Management (DIPAM) which spearheads the government's disinvestment goals.

This comes after the Core Group of Secretaries on Divestment headed by Cabinet Secretary Rajiv Gauba had approved conditions for the privatisation of the company.

Based on Monday's (21 December) share price of SCI, the government's stake is valued at about Rs 2,451 crore, with the company commanding a market capitalisation of Rs 3,845 crore.

Vedanta and Dubai’s DP World are among the companies said to have expressed interest in acquiring a stake in Shipping Corporation of India (SCI).

The roadshow organised by Department of Investment and Public Asset Management (DIPAM) reportedly attracted up to 9 potential investors, including shipping companies from Norway and South Korea.

While DP Dubai is among the top global players in cargo terminal operations, Vedanta is looking for captive fleet organisation that could support its mining and energy business.

The Union Cabinet on 20 November 2019 had accorded ''in-principle'' approval for strategic disinvestment of Government of India's shareholding of 63.75 per cent in SCI along with transfer of management control to a strategic buyer.

The Union government's DIPAM has appointed RBSA Advisors as the transaction advisor for the privatisation of SCI.

In November, the company’s board sought bids for a consultant to undertake de-merger/disposal of its non-core assets (real estate) ahead of its stake-sale and to carry out corporate restructuring for better operational performance.

SCI is largest Indian shipping company with a fleet strength of 59 vessels at present. It runs a fleet of 59 ships, including crude oil tankers, very large crude carriers, petroleum product carriers, liquefied petroleum gas carriers, bulk carriers, container ships and off-shore support vessels.

SCI owns and operates around one-third of the Indian tonnage, and has operating interests in practically all areas of the shipping business; servicing both national and international trades.