Disinvestment in Balmer Lawrie to kick off soon
Dipam has conveyed the message to the management that either disinvestment proceedings would take place at the valuation of Rs1,600 crore or the PSU will be shut down, sources told Bizz Buzz
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New Delhi: The central government will soon start the process of the sale of the 156-year-old state-run Balmer Lawrie. The government decided to privatize the diversified company over two years ago, but not much could be done because of the issue of valuation.
As Bizz Buzz reported earlier, there was a huge difference between the valuations done by the Balmer Lawrie management on the one hand and the Department of Investment & Public Asset Management (Dipam) under the Ministry of Finance and NITI Aayog on the other.
The government has decided to dismiss the valuation done by the management, official sources told Bizz Buzz.
Dipam recently held a meeting with the top management of Balmer Lawrie to work out speedy disinvestment. Dipam has conveyed the message to the management that either the disinvestment proceedings would take place at the valuation of Rs1,600 crore or the public-sector undertaking (PSU) will be shut down, the sources said. Balmer Lawrie’s mcap is in the region of Rs1,900 crore.
The government will expedite the disinvestment in the PSU for being part of the non-strategic sector. Finance Minister Nirmala Sitharaman in her Budget Speech had said a few years ago that the government will stay only in strategic sectors and there will be rationalization of the presence of the PSU in several other businesses.
The Balmer Lawrie management had earlier written to Dipam of valuation differences, claiming that the company should be valued much higher due to its operations in logistics. Dipam, however, has rejected all such claims.
Some of the Union Ministers are also learnt to be miffed at the services of ticketing provided by Balmer Lawrie.
Founded by two Scotsmen, Stephen George Balmer and Alexander Lawrie, in Kolkata, Balmer Lawrie started its corporate journey as a partnership firm in February 1867. Today, it enjoys a Miniratna status as a PSU under the Ministry of Petroleum & Natural Gas.
Balmer Lawrie has eight business units—industrial packaging, greases & lubricants, chemicals, travel & vacations, logistics infrastructure, logistics services, cold chains, and refinery & oil field services with offices spread across the country and abroad.
It has a turnover of Rs2,105 crore and a profit of Rs170 crore. It has four joint ventures and one subsidiary in India and abroad.
