Just when the government announced today that it had decided to sell its entire 95.38 per cent stake in Scooters India Ltd (SIL), Rajkot-based three-wheeler maker Atul Auto said that it was keen to buy the government’s ownership. Atul Auto managing director Vijay Kedia told Press Trust of India that they would be happy to look at the government’s offer.
The government on Thursday said it had decided to divest its entire 95.38 per cent stake in SIL. “The Union Cabinet has decided to revive SIL. It is being proposed to revive the company through induction of strategic partner by offloading the entire government equity of around 95 per cent,” Information and Broadcasting Minister Ambika Soni told the media. The balance 5 per cent equity will remain with banks, financial institutions, corporate bodies and others. The sale will be administered by the department of disinvestment, which will seek the approval of the Parliament to induct a strategic partner.
The company, which manufactures three-wheelers under Vikra brand and once made brands like Vijai Super and Lambretta scooters, was suffering losses since 2002-2003 and by 2008-2009, its entire networth was eroded. The sale is intended to revive the company. The company, which was incorporated in 1972, has an ageing workforce, as well as old plants and technologies. Also, it has not been able to pay salaries and statutory dues.
In March, 2009, the company was declared sick and was referred to the Board for Reconstruction of Public Sector Enterprises (BRPSE). As on 2009-10, it had a net loss of Rs 22.03 crore.
Following the news, shares of SIL jumped by 4.92 per cent to touch the upper circuit limit of Rs 38.40 on the Bombay Stock Exchange.
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