SCI divestment: due diligence ongoing, government says

The government has said that the due diligence process for the strategic divestment of the Shipping Corporation of India (SCI) is underway. In a written response to a question asked in the House of Commons, Finance Minister Dr. Bhagwat Kishanrao Karad: “A Preliminary Information Memorandum (PIM)/Expression of Interest (EoI) was published on 22.12.2020. Several EOIs were received by the deadline (03/01/2021). Eligible bidders have been shortlisted and the due diligence process is ongoing on the second phase of the transaction.”

The Cabinet Committee on Economic Affairs (CCEA) had approved “in principle” the strategic divestment of the government’s 63.75 per cent stake in Shipping Corporation of India Limited (SCIL) along with the transfer of management control in November 2019.

SCI divestment

The Shipping Corporation of India’s strategic divestment process involves the divestment of government shares in SCI and management control of the company to a strategic buyer. SCI’s non-core assets have been spun off pursuant to a demerger/transfer order issued by the Ministry of Corporate Affairs (MoCA) on 23 February 2023 to the demerged company Shipping Corporation of India Land and Assets Limited (SCILAL), which will remain a government company. These non-core assets would not be transferred to the strategic buyer of SCI.

The strategic divestment process is based on an open, transparent and competitive bidding process in which the QIBs participate and the sale price is determined. The net value of non-core assets (land and buildings) of SCI was Rs. 2,392 crore in FY21.

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