Suitors make a beeline for 26% stake in BEML

No less than six firms, together with Tata Motors Ltd, Mahindra and Mahindra Ltd and Ashok Leyland Ltd, wish to purchase a 26% stake in state-run defence gear maker BEML Ltd, two folks conscious of the developments mentioned.

Bharat Forge Ltd and Megha Engineering and Infrastructure Ltd can also submit expressions of curiosity for the federal government’s stake in BEML, the folks mentioned on situation of anonymity.

Corporations equivalent to Tata Motors, Mahindra and Ashok Leyland wish to search management of BEML as a part of their technique to develop their defence manufacturing companies and minimize dependence on the core business automobile enterprise, which is cyclical in nature.

“For auto firms, BEML is a significant competitor within the tenders and would ultimately win a number of them because it’s state managed. Therefore, it is smart for these firms to accumulate the heavy-vehicle manufacturing firm,” mentioned a senior government from one of many companies cited above, requesting anonymity.

The federal government, which owns 54% in BEML, invited expressions of curiosity for the stake sale within the defence gear maker, together with the switch of administration management, on January 4. The division of funding and public asset (Dipam) initially set March 1 because the deadline for submission of curiosity however later prolonged it to March 22.

SBI Capital Markets Ltd is advising the federal government on the sale course of. “After the EoIs (expressions of curiosity have been acquired, SBI Capital Markets will intimate the shortlisted bidders of the subsequent stage,” mentioned one of many folks cited above.

BEML manufactures merchandise such because the Prithvi missile launcher, military transportation autos, and railway and metro coaches. The corporate operates in three main enterprise segments—mining and development, defence and aerospace, and rail and metro. It has 9 manufacturing items in Bengaluru, Kolar Gold Fields, Mysuru, Palakkad and Chikkamagaluru.

Spokespeople for SBI Capital Markets, Mahindra and Mahindra Ltd and Ashok Leyland Ltd declined to remark.

A spokesperson for Megha Engineering confirmed the corporate’s curiosity in BEML however declined to elaborate.

Queries emailed to the spokespeople for the finance ministry, Dipam and Tata Motors on Friday afternoon and Bharat Forge on Saturday morning remained unanswered until the time of publishing this story.

Presenting the Union price range for the yr beginning April 1, finance minister Nirmala Sitharaman introduced particulars of a brand new central public sector enterprise (CPSE) coverage, paving the best way for the privatization of non-strategic state-owned firms.

Sitharaman has mentioned that the federal government goals to maintain the “naked minimal” CPSEs in 4 strategic sectors and privatize the remaining or shut down unviable ones. The sectors are atomic power, area and defence; transport and telecommunications; energy, petroleum, coal and different minerals; banking, insurance coverage and monetary companies.

The stake gross sales in BEML will assist bolster the federal government’s efforts to lift funds through asset gross sales for the subsequent fiscal yr. The federal government hopes to generate 1.75 lakh crore from disinvestment receipts within the coming fiscal.

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