Govt set to float EoIs soon for stake sale in BEML

Privatisation

The Centre is set to invite Expression of Interest (EoI) before the end of March this year to sell 28% of its stake in defence PSU BEML Ltd, a top company official said.

“The government has already decided to disinvest up to 28% stake in the company through strategic disinvestment. The EoIs will be floated anytime soon,” Deepak Hota, Chairman and Managing Director, BEML told DH.

Currently, the government of India holds 54.03% stake in BEML. “There has also been a suggestion whether the entire 54% stake held by the government be divested. However, the government is yet to take a decision on that. We expect a decision to come out very soon,” Hota said.

The Department of Investment and Public Asset Management (DIPAM) has constituted an Inter-Ministerial Group (IMG) for the purpose of appointing intermediaries such as Asset Valuer (AV), Transactional Advisor (TA) and Legal Advisor (LA) for the strategic disinvestment of 26% equity in the company out of the 54.03% held by the government.

As per the terms, DIPAM has appointed SBI Capital Markets Limited as TA and Crawford Bayley as LA, and MoD has appointed RBSA Valuation Advisors LLP, Ahmedabad as AV respectively. Further, based on the advice of DIPAM, due diligence has been completed and the matter is under consideration of DIPAM/MoD, the company had stated in its annual report.

BEML is a Mini Ratna Category–I public sector enterprise under the administrative control of the Department of Defence Production, Ministry of Defence.

BEML manufactures and supplies defence ground support equipment such as Tatra based high mobility trucks, aircraft towing tractors etc. Under Mining and Construction business, the company manufactures and supplies equipment like bulldozers, excavators, dumpers, shovels, loaders and motor graders to various user segments and under Rail and Metro business, manufactures and supplies rail coaches, metro cars, ACEMUs, OHE cars, steel and aluminium wagons to the rail and metro sector.

JV with Tatra

Hota said the company is looking at forming a joint venture company with Czech vehicle manufacturer Tatra Trucks for manufacturing components required to service their trucks. Currently, a range of components and parts are imported.

“We are looking at setting up a greenfield manufacturing plant for this purpose. We are looking at defence corridors in Uttar Pradesh and Tamil Nadu for the same,” Hota said adding that the JV details are yet to be finalised.