BEML demerger by October; financial bidding to follow

The government is likely to invite financial bids for the privatisation of BEML in the December quarter, an official said. Earlier this month, the corporate affairs ministry approved the hiving off the firm’s land and non-core assets to BEML Land Assets Ltd. The official said that every shareholder of BEML will get shares in BEML Land Assets and the process of demerger would be completed by the end of September or early October. Once the demerger process gets over by September-end or by early October, the financial bids for strategic sale of BEML would be invited, an official said, adding that the draft share purchase agreement too would be finalised by then. In January last year, the government invited preliminary bids for selling 26 per cent stake in BEML along with the management control. Multiple Expressions of Interest (EoIs) were received by the government, after which the process of demerger was initiated following comments from investors. Once the demerger is complete, financial bids would be invited. The government currently holds 54.03% in BEML, which is a defence public sector undertaking. At the current market price, sale of a 26% stake in BEML will fetch around Rs 20 billion. In 2016, the Union Cabinet approved the strategic disinvestment along with transfer of management control of the company. See also: Adani to launch open offer to acquire stake in ACCPM lays foundation stone of projects worth Rs 4400 crore in Bhuj