Privatization: Another government company handed over to private hands

Despite protests against privatization, the government has handed over another big company to private hands. On this day, the government company has been bought by veteran business man Ratan Tata. Actually this company was running in loss and this plant is closed since March 30, 2020. 

It is noteworthy that Odisha-based Neelachal Ispat Nigam Limited (NINL) is being handed over to a firm of Tata Group, its entire process is likely to be completed by mid-July. Tata Steel Long Products (TSLP), a unit of Tata Steel, had in January this year won the bid to acquire 93.71 per cent stake in NINL at an enterprise value of Rs 12,100 crore, an official said. The company achieved this success leaving behind a consortium of Jindal Steel & Power Limited, Nalwa Steel & Power Limited and JSW Steel Limited. Now soon Ratan Tata’s firm will take care of it.

An official told, “The transaction is in the final stage and the transfer should happen by the middle of next month.” Since the government has no stake in the company, the sale proceeds are not credited to the exchequer. Instead it will go to four CPSEs and two PSUs of the Odisha government.”

Neelachal Ispat Nigam Limited has an Integrated Steel Plant at Kalinganagar, Odisha with a capacity of 1.1 MT. This government company is also running in huge losses and this plant is closed since March 30, 2020. The company has debts and liabilities of over Rs 6,600 crore as on March 31, 2021, which includes Rs 4,116 crore to promoters, Rs 1,741 crore to banks, other creditors and huge dues of employees.