NEW DELHI: The government on Thursday announced that Neelachal Ispat Nigam Ltd (NINL) and Tata Steel Long Products (TSLP) signed a share purchase agreement, taking the disinvestment transaction to the closing stage.
In a statement, the Department of Investment and Public Asset Management (DIPAM) said that the company has executed the Share Purchase Agreement and Escrow Agreement (definitive agreements) for sale of its entire equity holding of 10.10% in NINL to TSLP. The successful bidder will be selected through the two-stage auction procedure involving a competitive bidding process, run under the aegis DIPAM.
“SPA signed today by JV partners of NINL with Tata Steel Long Products. The disinvestment transaction now moves to the closing stage,” said DIPAM Secretary Tuhin Kanta Pandey in a tweet. In January, Tata Steel arm accepted a letter of award (LoA) for the acquisition of a 93.7% stake in NINL for Rs 12,100 crore. NINL is a joint venture of MMTC, NMDC, BHEL, MECON and 2 Odisha government PSUs - OMC and IPICOL.
The government in January 2020 had approved strategic disinvestment of equity shareholding of MMTC (49.78%), NMDC (10.10%), MECON (0.68%), BHEL (0.68%), IPICOL (12.00%) and OMC (20.47%) in NINL. Addressing a webinar by the Merchants Chamber of Commerce and Industry (MCCI), Tuhin Pandey said the government has recently successfully privatised two organisations, Air India and NINL. He highlighted several privatisation transactions of the government are now in an advanced stage and Expressions of Interest (EoI) will be invited soon. On LIC IPO, he mentioned that the DRHP has been filed already and is watching the market conditions due to the Russia-Ukraine conflict.
Letter of award (LoA) for the acquisition
In January, the Tata Steel arm Tata Steel Long Products accepted a letter of award (LoA) for the acquisition of a 93.71% stake in NINL. NINL is a joint venture of MMTC, NMDC, BHEL, MECON and 2 Odisha government PSUs - OMC and IPICOL