In November 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.
After certain allegations were levelled against the bidder and the bidding process, in January, the issue of a Letter of Intent (LoI) to the bidder was put on hold.
“The Government examined these allegations and found merit only in one allegation regarding pendency of a proceeding in National Company Law Appellate Tribunal (NCLAT) against the successful bidder that may result in disqualification of the bid under applicable provisions of Preliminary Information Memorandum (PIM) and Request for Proposal (RFP),” it said.
After giving the successful bidder due opportunity to show cause on points of disqualification, the alternative mechanism, headed by the Finance Minister, decided to terminate the privatisation process of CEL.
“The Government of India has decided, based on the decisions of the Alternative Mechanism, to (i) disqualify the successful bidder (ii) exclude the successful bid from any further consideration and (iii) terminate the current transaction,” the Department of Investment and Public Asset Management (DIPAM) said.
Incorporated in 1974, CEL, under the ministry of science and technology, makes Solar Photovoltaic (SPV) cells and has developed the technology. It has also developed axle counter systems that are being used in railway signalling systems for the safe running of trains.
For the strategic disinvestment of CEL, open bids were invited based on the criteria of networth as laid down 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 by the transaction adviser and asset valuer.