Govt calls off strategic sale of Central Electronics

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Govt calls off strategic sale of Central Electronics

The government on Wednesday called off the strategic sale of Central Electronics Ltd CEL as the selected bidder did not disclose its ongoing litigation in the NCLAT In November of last year, the government approved the sale of CEL, a public sector enterprise under the Department of Scientific and Industrial Research DSIR, to Delhi based Nandal Finance Leasing for Rs 210 crore. In January, a letter of intent LoI was put on hold by the bidder after certain allegations were levelled against the bidder and the bidding process. The Government looked at these allegations and found merit only in one allegation regarding the pendency of a proceeding in the National Company Law Appellate Tribunal NCLAT against a successful bidder that could result in disqualification of the bid under applicable provisions of the Preliminary Information Memorandum PIM and Request for Proposal RFP it said. After giving the successful bidder a chance to show cause on points of disqualification, the alternative mechanism, headed by the Finance Minister, decided to end the privatisation process of CEL. The decision of the Government of India is to disqualify the successful bidder iii and remove the successful bid from any further consideration and iii terminate the current transaction, according to the Department of Investment and Public Asset Management DIPAM. CEL, which was founded in 1974, makes Solar Photovoltaic SPV cells under the ministry of science and technology. It has developed axle counter systems that are used in railway signalling systems for the safe running of trains. Open bids were invited based on the criteria of networth as laid out in the Preliminary Information Memorandum PIM Expression of Interest EoI The bid by Nandal Finance was higher than the reserve price of Rs 194 crore set by the government, based on the valuations of the transaction adviser and asset valuer.