Govt shortlists 15 bidders for Nalco stake

NEW DELHI: Even as the Cabinet continues to debate over the issue of privatisation, the government has shortlisted nearly 15 prospective bidders including Sterlite Industries and Hindalco for strategic sale of National Aluminium (Nalco) and due diligence is slated to take off by end-October.
Official sources confirmed that advisors for the sale had pre-qualified all but one of the nearly 15 bidders, who had submitted an expression of interest (EoI), due to its failure to meet the $250m net worth criteria. Global advisors are also learnt to have despatched documents pertaining to the sale to bidders over the weekend.
Sources said that in a unique exercise, data room visits would be replaced by a new software enabling setting up of a ‘virtual data room’. The move will help the government and bidders to save time and cost associated with a mechanical exercise. Government proposes to disinvest 60% stake in the company through a combination of strategic sale, American Depository Receipt (ADR) and domestic offering. It currently holds around 87.15% in the company.
It would offer 29% to a strategic partner, while 20% will be offloaded through the ADR route, and the rest will be offered to retail investors. ABN Amro, Rothschild, and Enam Securities have received the mandate to act as global advisors, while ICICI Securities and JP Morgan have been appointed as co-book runners.
Amongst those in the fray for the aluminium major’s stake are Aluminium Pechiney of France, Russian Aluminium (Rusal), Glencore of Switzerland, Alcan and Alcoa. — Agencies
Plant visits by prospective bidders are expected to commence by the end of the month, sources added. Earlier, coal and mines minister Uma Bharti is believed to have written to Prime Minister AB Vajpayee expressing the view that strategic sale of the company should be put off pending completion of expansion programmes.
Nalco is currently undertaking a Rs 4,000-crore expansion of its facilities which would double its mining capacity.