Govt Likely to Put Pawan Hans Sale on Hold Because on NCLT Order Against Winning Firm: Report
The Wire Staff
Real journalism holds power accountable
Since 2015, The Wire has done just that.
But we can continue only with your support.
New Delhi: The Business Standard has reported that the Union government is likely to put the Pawan Hans sale on hold indefinitely, since one of the members of the winning consortium has received an adverse court order.
On April 29, 2022, the Cabinet Committee on Economic Affairs approved Star9 Mobility Private Limited’s bid to buy the government’s 51% stake in public sector helicopter service provider Pawan Hans Limited for Rs 211 crore. Star9 Mobility is a consortium of three different entities – Maharaja Aviation Private Limited, which owns 25%, Big Charter Private Limited (with 26%) and Almas Global Opportunity Fund with the remaining 49%.
As an investigation by The Wire and Newsclick has revealed that the largest stakeholder in the consortium – Almas – has been sanctioned by the National Company Law Tribunal (NCLT) and it is not clear whether it has fully met the eligibility criteria laid down by the government for bidders. The investigation found:
"On April 22, 2022, the Kolkata bench of the National Company Law Tribunal (NCLT) passed an order in a case that involved Almas Global.
The case concerned the acquisition of EMC Limited, a Kolkata-based company that provides systems used in power transmission and distribution equipment, by Almas Global, through the Corporate Insolvency Resolution Process. Almas Global Opportunity Fund had successfully bid to acquire EMC Limited after the company had entered the insolvency resolution process in 2019. According to the case before the NCLT that had been brought by the resolution professional, Almas Global had failed to pay around Rs 568 crore to EMC’s creditors under the resolution plan that it had proposed, and which had been accepted. Further, the petitioner to the NCLT alleged that Almas Global was repeatedly making a variety of excuses for failing to pay and discharge its duties towards implementing the resolution plan.
The NCLT’s order flayed the conduct of Almas Global and accused it of “wilful contravention of the approved resolution plan”. The tribunal ordered that two performance bank guarantees amounting to Rs 30 crore submitted by Almas Global be forfeited, and that the company and its officers be proceeded against. Specifically, the NCLT called for a copy of its order in the case to be sent to the secretary, Ministry of Corporate Affairs and to the Insolvency and Bankruptcy Board of India, the agency authorised to initiate a complaint against Almas Global and its officers.
The NCLT’s order noted multiple violations by the company and its authorised representative, Amardeep Sharma. It said that Sharma “tried to mislead the court” and that Almas Global “has taken the entire process for a ride.”"
This is the second time in recent months that the Union government's plans to sell a public sector undertaking to private owners has come under scrutiny. In January, the government was forced to put on hold the sale of Central Electronics Limited after doubts were raised about the winning bidder’s financial track record, the cases pending against it in the NCLT and questionable inter-connections among bidders.
This article went live on May sixteenth, two thousand twenty two, at fifty-six minutes past three in the afternoon.The Wire is now on WhatsApp. Follow our channel for sharp analysis and opinions on the latest developments.