In a severe jolt to the divestment of National Fertilisers Ltd, the three bids submitted for acquiring majority stake in the fertiliser PSU are understood to be below reserve price set by the government.
Sources associated with the divestment process in NFL confirmed that none of the bids were above the reserve price, but did not give the details.
Only recently, Tata Chemicals had opted out of the race saying acquisition of NFL would not add significant value to the company's existing operations. Even IFFCO had withdrawn from NFL divestment.
With major contenders backing out, the Birla Group promoted Zuari Chambal Fertilisers, Indo-Gulf Fertilisers and Kribhco were left in the fray for NFL, where the government has decided to sell 51 per cent stake to a strategic partner along with management control and for which Rabo Bank has been appointed as the global advisor.
The divestment of NFL has been embroiled in controversy for the last few years as the government had to abort an earlier attempt to sell the company in the wake of policy initiatives leading to a new round of pricing.
Earlier this year, the Centre decided to invite fresh bids for NFL, but the move was opposed by Chemicals and Fertilisers Minister S S Dhindsa, who sought deferment of the process for two years.
Dhindsa had argued that the time period would allow the government to assess the impact of the new fertiliser policy on the units located in Nangal, Panipat, Bhatinda and Vijaypur.
The government currently holds about 97 per cent stake in NFL, which employs close to 5,000 people.
