DoD to refer back Hind Cables as bidders desert

NEW DELHI: The Disinvestment Department is understood to have decided to return Hindustan Cables (HCL) to Heavy Industry Ministry after failing to get any bidders for privatisation of the cable manufacturer.
The move to refer the PSU to Department of Heavy Industry comes after several prospective bidders jumped ship after nearly two years since the start of the process, sources said.
The department would now put up the PSU for closing the case to cabinet.
The proposal for sale came a cropper after meeting a luke warm response from bidders who refused to take on the company in view of its huge debt burden of nearly Rs 700 crore.
Earlier attempts to convince financial institutions to agree to a restructuring proposal failed with lenders refusing to accept a deal involving separation of the debts from the books of the company.
Institutions also declined to write off the debts to pave the way forward for privatisation.
As many as five bidders were reported to be in the fray for acquiring government stake in the cable manufacturer including metals major Sterlite which runs fibre manufacturing unit.
The government had decided to divest 74 per cent stake in the company to a stretagic partner along with management control and had mandated I-Sec to act as global advisors.
HCL is engaged in the manufacture of jelly filled and optical fibre cables at its four units in West Bengal, UP and Andhra Pradesh.
It had a capital base of Rs 414 crore and a negative net worth of Rs 199 crore as on March 2000.