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PSU MARKET

SAIL pre-bid meet on Mar 15 for advisors

Anjana Das, New Delhi
11/03/2017   0 Comments

The ground work for Steel Authority of India Limited (SAIL)’s  strategic sales  in three of its special steel units gets underway on March 15 with the Maharatna steel PSU slated to hold pre-bid meeting on that day seeking proposals and bids for transaction, legal Advisors and now an asset valuer to assist the process sail through.
 
SAIL has invited separate proposals  and  bids  for appointing Transaction Advisor, Legal Advisor and Assets Valuer in connection with strategic disinvestment of  its three special steel plants -- Alloy Steels Plant, Durgapur (ASP), Salem Steel Plant, Salem (SSP) and Visvesvaraya Iron and Steel Plant, Bhadrawati(VISP)  with transfer of Management Control.
 
The PSU has now kept a provision for Asset Valuer also in the RFP (request for Proposal ) document, Finance Ministry sources said.
 
Provision of holding pre-bid meeting exists in the respective Request for Proposal(s) documents for engagement as Transaction Advisor and Legal Advisor. It has now been decided to keep such a provision in the Request for Proposal document for engagement of Assets Valuer also, Bureaucracy Today has learnt.  
 
The Government  has 'in-principle' decided for strategic disinvestment of ASP, SSP and VISP of Steel Authority of India Ltd with transfer of management control to the new owner (s).
 
The Asset Valuer will to carry out valuation of the entire tangible and intangible assets of the Divesting Plants including, Land & Buildings, Civil Infrastructure like roads, drains, compound wall, Plant & Machinery, Furniture & Fixtures, stock inventory  on an “as is where is basis”. The valuation is to be done keeping in view the objective of disinvestment.
 
The valuer , as per the Government  terms of reference  will seek valuation of these three plants in the  single or combination of methods  -- Comparison Method; Income Capitalisation; Discounted Cash Flow; Cost Approach method; Replacement valuation; or  any other generally accepted valuation methods.
 
In estimating the market value for the above assets, the Valuer  will have to  clearly identify and describe the property being valued factoring into the inventory provided by SAIL (the Company) and due Diligence and Review of the location, site plans, Plant & Machinery and due diligence on approvals from various regulatory authorities as applicable, lay outs etc. Review of physical encumbrances, if any. 
 
It will also have to collect information and conduct due diligence of matters like market information, quotations and offers of similar assets sold or available in close proximity to the subject property.
 
The government has budgeted to raise Rs15,000 crore from strategic disinvestment in 2017-18.

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