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PPL selloff decision on Feb 14

The cabinet committee on divestment is likely to take a decision on the sole price bid for the 74 per cent of government stake in Paradeep Phosphates on February 14.

Last week the gtovernment sold controlling stakes in telecoms giant Videsh Sanchar Nigam Ltd and oil retailing firm IBP for Rs 25.93 billion.

The divestment department is in a dilemma over the privatisation of PPL as the sole bidder for the loss-making, fertiliser PSU -- the combine of the Chambal group and the Moroccan company OCP -- has offered about Rs 200-300 million less than the reserve price of about Rs 1.80 billion.

Out of the four short-listed bidders, Tata Chemicals, state-run Rashtriya Chemicals and Fertilisers, and Oswal Fertilisers have already walked out.

The combine, according to sources, have offered a price in the range of Rs 1.40-1.50 billion whereas the reserve price determined by PPL's global advisor Deolitte Touche Tohmatsu is Rs 1.70-1.80 billion.

This has divided the officials in the department. While one section favours selloff to put a stop to near-continuous drain on government, others are in the process of evaluating the impact of a possible sale below the reserve price.

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