HAL disinvestment likely in second half of fiscal year

[SRP]

Government is likely to offload 10 per cent stake in defence equipment maker Hindustan Aeronautics (HAL) through an initial public offer in the second half of the current fiscal year.

“We will start HAL disinvestment process shortly. The stake sale is likely around November-December,” a Finance Ministry official said.

The government has already appointed four merchant bankers — SBI Cap, Goldman Sachs, Barclays and Axis Capital — for managing the stake sale in HAL.

“Merchant bankers are conducting due-diligence on 29 production divisions, nine joint ventures and 10 Research & Design centres,” the official said, adding the Defence Ministry is working on restructuring of company’s board.

The Cabinet in November last year had approved selling of 10 per cent stake or 1.20 crore equity shares through an initial public offer (IPO) of Navratna defence equipment maker HAL. The company provides maintenance and overhaul services to aircraft.

The paid-up capital of HAL is Rs. 120.50 crore comprising 12.05 crore shares of face value of Rs. 10 each as on March 31, 2011. The government holds 100 per cent of the paid-up capital of the company.

The Defence Ministry is in the process of restructuring the board of the defence PSU. The government is in the process of modernising the company for which Rs. 20,000 crore would be required over the next five years.

The government had set up expert groups under former Cabinet Secretary B K Chaturvedi for restructuring of HAL.

HAL disinvestment likely in second half of fiscal year | idrw.org

 

[anant_s]

now now, lets see who picks up the equity

 

[Abingdonboy]

A controlling stake should be given to a pvt entity so that they bring about the efficiencies and practices that come from the pvt. The Pvt sector is not always the "magic bullet" and no one can take away from HAL's achievements whilst under public control, however there are certain areas where a new mindset would do wonders for HAL.


HAL has become far too large, and is continuing to grow at an exponential rate, to still be under Govt control anyway IMHO.

 

[S-DUCT]

Is it right decision,will it be good or bad for HAL.?

 

[selvan33]

well surely reliance aerospace will try to pick the opportunity.

 

[Nitin Tomer]

Good step, HAL has so far been incompetent

 

[Ajaxpaul]

LIC is ready as always

 

[WHITESMOKE]

TATA or Reliance