The central government today approved ₹211 crore bid from Star9 Mobility Pvt Ltd – a consortium of three companies – for the strategic divestment of Pawan Hans Limited. Pawan Hans is a joint venture of GoI and CGSB, providing helicopter and air mobility services.
The Department of Finance, in a statement issued today, said the alternative mechanism empowered by the Cabinet Committee on Economic Affairs has approved the highest bid by Star9 Mobility Private Ltd for the sale of the entire government participation (51% stake) of Pawan Hans Limited (PHL) and transfer of management control.
Finance Minister Nirmala Sitharaman, Transport Minister Nitin Gadkari and Civil Aviation Minister Jyotiraditya Sinha are the members of the Alternative Divestment Mechanism.
“The reserve price for the sale of 51% of PHL shares has been set at ₹199.92 crore, based on expert valuation (deal advisor and asset appraiser). Three bids were opened in the presence of the bidders. All three bids were found to be valid,” the ministry statement said.
“Star9 Mobility Private Ltd, a consortium of Big Charter Private Limited, Maharaja Aviation Private Limited and Almas Global Opportunity Fund SPC, became the highest bidder citing ₹211.14 crore, which was above the reserve price. The other two offers were for ₹181.05 crores and ₹153.15 crore. After deliberations, the financial offer from Star9 Mobility Private Limited has been accepted by the government,” the statement said.
Notably, Pawan Hans Ltd suffered losses in the past three years (FY19, FY20 and FY21) and the strategic sale process could only be completed on the fourth attempt. The company has a fleet of 42 helicopters.
PHL’s strategic divestment was approved by Cabinet in October 2016. The transaction had been attempted three times in the past. In the first round in 2017, out of four expressions of interest received, only one was deemed eligible and the transaction was canceled.
In another attempt in 2018, two bidders were eligible and received the Request for Proposal (RFP). But only one incomplete offer, not conforming to the RFP, was received. In the third attempt in 2019, out of four Expressions of Interest received, only one was deemed eligible and the process was cancelled. In the current round launched on December 8, 2020, seven EoIs were received and four interested bidders were shortlisted as qualified bidders who were invited to submit financial bids.
The remaining 49% stake in Pawan Hans is held by ONGC, which previously decided to offer its entire stake to the government-identified successful bidder in a strategic divestment transaction, at the same price and on the same terms as the central government.