Government Approves Star9 Mobility Bid To Buy 51% Stake In Pawan Hans For Rs 211 Crore
Government approves Star9 Mobility's winning bid over strategic sale of Pawan Hans for a price of Rs 211.14 crore
The central government has approved Star9 Mobility Pvt.'s bid to acquire 51% stake and management control over Pawan Hans Ltd. for Rs 211.14 crore.
The helicopter and aero mobility company has been experiencing losses over the last three years, prompting the government to consider a strategic disinvestment of its entire stake, the Finance Ministry said in its statement on Friday.
"With this privatisation, it is expected that the strategic buyer will revitalise the company by replacing the ageing fleet through infusion of fresh capital and improve the performance of the company," the statement said.
The Government of India holds 51% stake in the company, while ONGC Ltd. owns the remaining 49%.
Star9 Mobility Pvt. is a consortium of M/s Big Charter Pvt., M/s Maharaja Aviation Pvt., and M/s Almas Global Opportunity Fund SPC.
Star9 Mobility Pvt. emerged as the highest bidder for the reserve price set at Rs 199.92 crore. The competing bids were for Rs 181.05 crore and Rs 153.15 crore, respectively.
The disinvestment process over the helicopter carrier had been attempted thrice before, with the cabinet approving the divestment process as early as October 2016.
"This is the fourth iteration with request for Expressions of Interest invited on Dec. 8, 2020. Seven EoIs were received and four interested bidders were shortlisted as qualified bidders... Three financial bids were received," the ministry said in its statement.
With the bid approved, the transaction now moves to the concluding stage where the Letter of Award would be issued, followed by the signing of the share purchase agreement and closing of the transaction.
The strategic disinvestment transaction was implemented by a multi-layered consultative decision-making mechanism involving an inter- ministerial group, core group of secretaries on disinvestment, and the empowered Alternative Mechanism.
The Alternative Mechanism comprises Union Minister for Road Transport and Highways Nitin Gadkari, Union Minister for Finance and Corporate Affairs Nirmala Sitharaman, and the Union Minister of Civil Aviation Jyotiraditya Scindia.