Government Aborts Strategic Sale, Disqualifies Winning Bidder in Pawan Hans Disinvestment
The successful bidder consortium Star9 Mobility Pvt Ltd was disqualified due to ongoing legal proceedings, so the government has decided to cancel the strategic disinvestment of the helicopter services provider Pawan Hans, according to a statement released by the Department of Investment and Public Asset Management (DIPAM) on Monday. Government and ONGC have a 51:49 joint venture called Pawan Hans.
“…Government has determined that M/s Star 9 Mobility Pvt Ltd, the winning bidder consortia, is ineligible for Pawan Hans Ltd’s strategic disinvestment process under the conditions of PIM and RFP. Additionally, the existing EoI (expression of interest) procedure for strategic disinvestment is void, according to the statement from DIPAM.
The transfer of the national government’s ownership share and management control in Pawan Hans Ltd to Star9 Mobility Pvt Ltd for Rs 211 crore was authorized in April 2022. AGOF, Big Charter Pvt Ltd, and Maharaja Aviation Pvt Ltd have joined forces to become Star9 Mobility Pvt Ltd.
“Thereafter, it became known that the NCLT, Kolkata Bench, had recently issued an adverse order against AGOF, a member of the successful consortium, in another case relating to a resolution plan under the IBC,” the DIPAM statement from Monday reads. The Letter of Intent (LoI) was not granted in favor of the winning bidder due to the NCLT’s unfavorable ruling.
The concerned consortium member appealed the NCLT decision, according to DIPAM, to the National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi. The NCLT judgment was referred to MCA and IBBI for their consideration on the start of a complaint under Sections 74(3) and 236 of the Indian Bankruptcy Code, 2016, after NCLAT denied the appeal and affirmed the original NCLT ruling.
According to DIPAM, the Insolvency and Bankruptcy Board of India (IBBI) has complained to the special court about the consortium member in question.
“Government examined the adverse orders of NCLT and NCLAT and took note of the complaint filed by IBBI and considered that the adverse orders against a consortium member would lead to the successful bidder’s disqualification under the provisions of PIM and RFP,” it was further said. The winning bidder had a fair chance to contest the disqualification by submitting a show-cause notice.
The statement read, “After careful consideration of the successful bidder’s response to the Show Cause Notice, with the approval of Alternative Mechanism (duly empowered by Cabinet Committee on Economic Affairs) comprising Minister of Road Transport & Highways, Minister of Finance, and Minister of Civil Aviation,” the government has decided to disqualify the successful bidding consortium.
