Heavy industries minister for selling PSU stake to public

NEW DELHI: Heavy Industries Minister Balasahib Vikhe Patil on Sunday said he favoured offloading upto 25 per cent equity of state-owned units to the public as opposed to outright sale to a strategic partner.
"I am in favour of offloading upto 25 per cent equity in some of the PSUs straight away as enhancing public share will not only ensure that the common man has a share in its profits but also greater accountability on part of the PSUs," he said.
The minister said offloading to the public would also serve the objective of bringing in more public investment to revive some of the PSUs.
Patil said he had asked his ministry to identify the PSUs which could be offered to the public. "In the case of PSUs like BHEL which are already listed companies we will see if we can offload some more equity in favour of the public".
Asked if he favoured selling equity to a strategic partner with management control, he said "disinvestment is another route...but we cannot use it as a ground rule...it has to be on a case-by-case basis".
Patil''s stance in support of selling equity of PSUs to the public assumes relevance since there are already serious inter-governmental differences on the route to sell equity of leading oil PSUs — HPCL and BPCL.
Petroleum Minister Ram Naik and Defence Minister George Fernandes are reportedly in favour of public offers while the disinvestment ministry has favoured offloading equity in favour of a strategic partner.
The ministry has six listed companies - Bharat Heavy Electricals, HMT (Holding), Scooters India, Andrew Yule and Company, Hindustan Photo Films and Hindustan Cables.
The ministry is hopeful of completing the ongoing disinvestment process in Hindustan Newsprint, Hooghly Printing and Tide Water Oil by the year end.
According to ministry officials, due diligence process is in an advanced stage in all the three companies and the disinvestment process is expected to be completed by December-January.
Close to six companies have envinced interest in picking up majority stake in Hindustan Newsprint, a subsidiary of Hindustan Paper Corporation. SBI Caps has been appointed as the advisor for the disinvestment process.
In the case of Hooghly Printing Company, a subsidiary of Andrew Yule Company catering to printing and stationery requirement of the companies under Andrew Yule group, the proposal is for outright sale.
Sources said the government was hopeful of finding good buyers for the company since it is a profit making initiative. Production of the company in 2001-02 has been anticipated at Rs 6.90 crore.
In the case of Tide Water Oil, an associate company of Andrew Yule, the proposal is to sell off majority stake with management control to a joint venture partner.
AYCL has 72.29 per cent stake in the associate company with the remaining equity being held by financial institutions. As per the latest audited results, the company during 2001-02 achieved net sales of Rs 18,663.17 lakh, a profit before tax of Rs 1,096.26 lakh and a net profit of Rs 1,002.02 lakh.