Government approves turning REIL into independent CPSE

NEW DELHI: Government today approved hiving off profit-making Rajasthan Electronics and Instruments Limited ( REIL) from its parent company Instrumentation Ltd and turning it into an independent central public sector enterprise ( CPSE) under the Department of Heavy Industry.

The move will result in conversion of REIL into an independent CPSE with greater autonomy to capitalise on the available business opportunities and freedom to approach capital markets for expansion. It will help REIL attain a level of growth commensurate with its potential.

The decision was taken at a meeting of the Cabinet Committee of Economic Affairs (CCEA) chaired by Prime Minister Narendra Modi here.

"Government of India will buy IL (Instrumentation Ltd) shareholding of 51 per cent (62,47,500 shares of face value of Rs 10 each) at book value of Rs 77.09 per share, a fair valuation which comes to Rs 48.16 crore as on March 31, 2015," an official statement said.

REIL is a joint venture between Rajasthan State Industrial Development and Investment Corporation (RIICO) and Instrumentation Ltd, Kota, with 49 per cent and 51 per cent ownership, respectively.

The Kota unit has been in the red for many years.

Last year, employees of the Palakkad unit of Instrumentation Ltd, which too has been making profits, had met the Prime Minister demanding the unit either be given an independent status or merged with a profit-making PSU.