Govt seeks bids for 10% stake divestment in Rashtriya Chemicals and Fertilizers

Govt seeks bids for 10% stake divestment in Rashtriya Chemicals and Fertilizers

The government has sought bids from top 19 law firms for selecting legal advisors that will facilitate for disinvestment of 10% equity in Rashtriya Chemicals & Fertilizers Limited (RCFL) through an offer for sale or OFS.

Firms are to submit their bids by January 29, the department of investment and public asset management (DIPAM) said on Friday.

The government has separately sought bids from merchant bankers or selling brokers in the transaction, the last date for which has been set at January 28.

Bidders should have handled and completed at least one domestic equity issue of the size of Rs 200 crore or more during October 1, 2017 and September 30, 2020, the government has said as one of the conditions.

The law firm appointed will act as legal adviser to the transaction and submit proposals in consortium with an international law firm of repute, with similar experience and expertise in public offerings or OFS in capital markets.

Government holds 75% equity in the mini-ratna fertilizers and chemicals manufacturing company.

“The government is also considering allotting shares to eligible and willing employees of RCFL at a discount on the issue or discovered price (lowest cut off price) up to a maximum of certain percentage of the OFS size subsequent to completion of the transaction under OFS,” the department added.

The percentage and extent shall be decided in due course.

Rashtriya Chemicals & Fertilizers Limited is under the administrative control of ministry of chemicals and fertilizers. It has two operating units, one at Trombay in Mumbai and the other at Thal, Raigad district, about 100 kms from Mumbai.

RCFL manufactures Urea, Complex Fertilizers, Bio-fertilizers, Micro-nutrients, 100% water soluble fertilizers, soil conditioners and a wide range of industrial chemicals. It produces around 25 lakh MT urea, 4.75 Lakh MT complex fertilizers and 4.5 Lakh MT of industrial chemicals every year.

The authorised share capital of the company is Rs 800 crore and the paid up equity capital is Rs. 551.69 crore as on March 31, 2020. As on March 31, 2020, it has a net worth of Rs. 3186.27 crore.

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