The protracted bid to take Shipping Corp of India (SCI) private has passed another key hurdle with the government approval for the demerger of its non-core assets.
SCI has received approval from the Ministry of Corporate Affairs to separate non-core assets of the company into a new entity, a move seen as a significant step towards the government’s plan to divest its stake in the company.
“We wish to inform that the Ministry of Corporate Affairs has sanctioned the scheme of arrangement for demerger of non-core assets of Shipping Corp of India into Shipping Corp of India Land and Assets,” the company said in a regulatory filing.
New Delhi’s attempts to privatise the country’s flagship line have been going on for years with many bureaucratic hurdles.
The approval for strategic divestment of SCI was given by the Union Cabinet in November 2020. A call for expression of interest was floated in December same year for strategic divestment of India’s entire shareholding.
The government received multiple bids in March 2021, however, the demerger process was delayed.
The green light for a revised demerger plan makes it likely for privatisation to be completed by the fiscal year 2024.