Pawan Hans disinvestment: ONGC to offer its 49% shares to new buyer

Oil and Natural Gas Corporation (ONGC) will offer to sell its 49 per cent stake in Pawan Hans to its new buyer-Star9 Mobility Pvt Ltd after the government issued a letter of award (LoA) for its sale, said an official.

“Within seven days of issuing the LoA, ONGC will offer to tender its shares in Pawan Hans at the same price at which the Centre is exiting the helicopter service provider,” a senior government official said. The government intends to issue the letter next week, the official added.

Pawan Hans is a joint venture between the Centre and ONGC, and the former has decided to sell its 51 per cent stake to Star9 Mobility for Rs 211 crore. The preliminary information memorandum (PIM) had stated that ONGC will offer its entire 49 per cent shareholding to the successful bidder on the same price and terms.

After the offer is made by ONGC, the new buyer will get seven days to decide if it wants to buy the remaining 49 per cent stake held by the public sector undertaking (PSU), the official. “The buyer can even decide not to buy ONGC’s stake,” the official said.

Due sale process followed

Last week, the Centre identified Star Mobility — a consortium of Big Charter Pvt Ltd, Maharaja Aviation Pvt Ltd, and Almas Global Opportunity Fund SPC — as the successful buyer for Pawan Hans. The official said all due conditions laid out by the government in the preliminary information memorandum (PIM) have been followed to identify the buyer.

This comes after political parties alleged that the identified buyer does not meet the minimum net worth criteria of Rs 300 crore. Rebuffing these allegations, the government official said, net worth of all consortium members is considered before shortlisting buyers and not the special purpose vehicle (SPV) that is created by these interested parties to buy the Centre’s stake.

The conditions clearly state that if air transport service operators (ATSO) bid through a consortium, and hold up to 51 per cent in the special purpose vehicle (SPV), their net worth would be considered as nil. In case of Star9 Mobility, two consortium partners — Big Charter and Maharaja Aviation — holding 26 per cent and 25 per cent, respectively, are ATSOs and their net worth would be considered nil. The third consortium partner Almas Global, with 49 per cent, had a net worth of Rs 691 crore at the time of placing bids. Almas Global’s net worth will be considered as the net worth of the entire consortium, the official said.

The consortium members had the option to form an SPV for acquiring the stake in Pawan Hans any time after submission of expression of interest (EOI). The consortium members created Star9 Mobility in October 2021 for placing their bids.

“The SPV was formed solely to consummate the transaction,” the official said. To complete the transaction, the consortium members will have to transfer funds to the SPV for buying the government's stake, he added.

All due processes have been followed for the transaction, including sharing of the annual financial statements by consortium members for the 12-month period preceding the publication of PIM.

The Centre is looking to hand over the PSU to the new buyer in about one-and-a-half months, the official said.