“Although there were a couple of companies which had expressed interest, no one submitted a binding financial bid,” a government official aware of the development said.
This is the second time the sale process has failed after an attempt to divest the company last year was called off as only a single bidder was left in the fray.
While last time the Centre had put 51 per cent of the firm on sale, the latest attempt was to divest the entire 100 per cent shareholding. While the Centre holds 51 per cent, Oil and Natural Gas Corporation has the remaining 49 per cent in Pawan Hans.
The government believed that bundling the offer with ONGC stake could bring in better valuation for the company. The government had appointed SBI Capital, the investment banking arm of State Bank of India, as its advisor to manage the strategic disinvestment process of Pawan Hans. According to industry sources, Mumbai-based Global Vectra HeliCorp and HeliGo Charters had expressed initial interest but didn’t put in a binding bid.
Experts said the government should have followed the suggestion given by SBI Caps and done a public listing where ONGC could have reduced its stake. “The company is profitable. ONGC would have made a lot of money from selling stake in the market. Now that the attempt of stake sale has failed, the government has lost the chance of a profitable IPO too,” said Mark Martin, founder of aviation consultancy firm Martin Consultancy.
Pawan Hans, with a fleet of about 50 helicopters, runs domestic and offshore operations, charter services, rescue works, corporate and special charters and VIP transportation. It registered a profit of Rs 248 crore in 2016-17. As on January 31 this year, Pawan Hans had an authorised capital of Rs 560 crore and paid-up share capital worth Rs 557 crore.
The government plans to sell multiple public sector firms including Air India, Pawan Hans, Hindustan Fluorocarbons, Hindustan Newsprint, Bharat Pumps & Compressors, Scooters India, Bridge and Roof Co, Hindustan Prefab, and Projects & Development India.
This is the second time the disinvestment attempt has failed
Experts say the Centre should look for an IPO to obtain value from the firm
Pawan Hans has 43 choppers in its fleet