BHUBANESWAR: The strategic disinvestment transaction of Neelachal Ispat Nigam Ltd (NINL) was completed on Monday with the transfer of 93.71 per cent shares of the joint venture partners to Tata Steel Long Products Limited (TSLPL).
Announcing this at a media conference here, Union Secretary in the Department of Investment and Public Assets Management (DIPAM) in the Ministry of Finance Tuhin Kanta Pandey said that the JV partners of NINL had signed share purchase agreement (SPA) with TSLPL on March 10, 2022 after winning the bid for acquisition of 93.71 per cent equity stake in NINL by offering a price of Rs 12,100 crore.
"This payment has been utilised as per the SPA for settlement of dues of employees, operational creditors, secured financial creditors and sellers (operational and financial dues) and for equity of selling shareholders," he said.
Pandey said that all the pending dues of the employees have been cleared on priority basis and no employees have been retrenched. The company will now function with a new board of directors.
The strategic partners of NINL and the six selling shareholders worked towards satisfying a set of conditions defined in the SPA including certification of operational creditor’s dues, employees dues, sellers operational and financial dues. These conditions have been met to mutual satisfaction.
He further said, in the disinvestment process, the two Odisha government PSUs such as OMC and IPICOL have got Rs 1,246 crore and Rs 452 crore respectively.
Principal Secretary Industries Hemanta Sharma said that Tata has set an initial target of production of 5 million tonne of steel from NINL annually and later will increase the same to 10 million tonne. "This is not a disinvestment but an investment," he said.
The sick NINL with 1.1 million ton integrated iron and steel plant at Kalinganagar industrial complex in Jajpur district, is a joint venture of four central public sector enterprises namely MMTC with 49.78 per cent stake, NMDC (10.10 per cent), BHEL (0.68 per cent), MECON (0.68 percent) and two State government PSUs namely OMC (20.47 per cent) and IPICOL (12 per cent).
Tata Steel Vice-President, Corporate Service, Chanakya Chaudhary said that the acquisition of NINL provides an opportunity to restart the plant to its rated capacity.