Disinvestment of Shipping Corporation on track, but could take time

The strategic disinvestment of state-run Shipping Corporation of India is on track but could take some time, government sources indicated, adding that the listing of the demerged company is expected shortly.

“SCI is a strategic transaction. It’s already an ongoing one, and it has undergone several stages. One of the biggest issues was separation of the non-core assets. The demerger order has been issued by the Ministry of Corporate Affairs and now the new company will be listed,” said a senior government source.

The demerged entity- Shipping Corporation of India Land and Assets Ltd (SCILAL), is expected to be listed shortly. The source explained that once it is listed, certain No Objection Certificates have to be obtained from the state government, following which the financial bids will be invited.

“The strategic disinvestment of SCI is an ongoing process but the financial bidding could not proceed due to the demerger and subsequent listing,” the source further said.

As part of the strategic stake sale, the Centre plans to transfer its entire holding of 63.75 per cent along with management control to a private entity. To this end, the Department of Investment and Public Asset Management (DIPAM) had in December 2020 had floated the Preliminary Information Memorandum for inviting expression of interest for the disinvestment. By March 2021, it had received multiple expressions of interest for the transaction. 

The non-core assets of SCI, which includes basically prime real estate properties in Mumbai, were put in SCILAL, which was incorporated in November 2021. The new firm was incorporated with the object of holding and disposing the Non-core Assets of SCI distinct from the disinvestment transaction. The ministry of corporate affairs had in February this year sanctioned the scheme of demerger 

Headquartered in Mumbai, SCI has a fleet including bulk carriers, crude oil tankers, product tankers, container vessels, passenger-cum-cargo vessels, LPG, and offshore supply vessels. Based on the current market value, the strategic disinvestment in SCI could raise over Rs 3,100 crore for the Centre.