Divestment plan packs in compromise deals

NEW DELHI: Disinvestment Minister Arun Shourie on Monday asserted there were no restrictions for sale of equity in the two oil PSUs - HPCL and BPCL - acquired by Acts of Parliament, saying, after their nationalization, the two were governed by the Companies Act. We have examined the issue... We will have it further examined by others including Law Ministry... When we go to CCD we will have answered all the issues raised today in the Rajya Sabha, Shourie told reporters when asked about the issue of legality raised by Congree MPs including former Finance Minister Manmohan Singh in the Rajya Sabha. Pointing out that successive governments had divested 49 per cent equity in HPCL and 34 per cent equity in BPCL after acquiring the two companies from multinationals Esso and Burmah Shell, he said the law was the same for one share or more. According to the acquisition Act, there were no restrictions in change of equity holding and the two companies were being governed by the Companies Act after their nationalisation, he said. Drawing parallel to what happened in the case of Maruti where the government's holding came down to below 50 per cent in 1992 when Dr Manmohan Singh was the Finance Minister, Shourie said, If there is anything illegal there is remedy in courts. We have examined the Act and there is no difficulty, he said. Shourie said the Defence Minister had made very valuable suggestions and his paper was circulated among the concerned ministries and added, George Fernandes was there when we took the unanimous decision (at a meeting convened by Prime Minister on December 5). He said he would also consult Petroleum Minister Ram Naik, an important member of the CCD, on the two oil PSUs as it was the practice to discuss with administrative ministry concerned about the sale of equity in any PSU. Asked if oil PSUs like ONGC would be allowed to bid for HPCL, Shourie said the CCD had decided in September in general to bar all PSUs to bid for those put on the block. In any specific case, if an administrative ministry wants exception than it should come to CCD for permission, he said, adding that earlier Parliamentary Affairs Minister Pramod Mahajan had commented on this saying, in case PSUs were allowed to bid, then the easier route for the government was to merge such corporations. He also appealed that nobody should invent difficulties in the way of divestment process and pointed out that an in-principle decision was taken in February to divest in the oil PSUs which got delayed. He also gave the examples of Air India, which was acquired from the Tatas by an Act of Parliament, VSNL and some other PSUs where successive governments had sold equity without approaching Parliament for amendments or repeal of respective Acts.

Divestment plan packs in compromise deals

Disinvestment Minister Arun Shourie on Monday asserted there were no restrictions for sale of equity in the two oil PSUs - HPCL and BPCL - acquired by Acts of Parliament, saying, after their nationalization, the two were governed by the Companies ...

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