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The Gujarat government has once again initiated process for divestment of its wholly owned company Alcock Ashdown (Gujarat) Ltd (AAGL), primarily engaged in shipbuilding.
The state government plans to divest 100 per cent stake in the profit-making company. For this it has begun process to hire consultants and merchant bankers, said top state government official. "Plan for divestment of AAGL has been initiated and the process for identifying consultants and merchant bankers have commenced," he said, declining to divulge more details.
State industries commissioner Kamal Dayani, who is also ex-officio chairman of AAGL was not available for comments despite repeated attempts.
In case of AAGL, similar process was initiated number of times since 2002 however, nothing could be materialised for one reason or the other. It was in 2007 that the divestment process reached close to completion after the state government invited bids from interested companies.
But the divestment process hit a roadblock in when both ABG Shipyard Ltd and Elecon Engineering Ltd, the companies shortlisted for buying out the government's stake in the company, had quoted much less than the reserved price of Rs 350 crore.
The decision to privatise the company was taken when the global ship-building business was stagnant. When the state government decided to exit ship-building, the business suddenly zoomed and the company’s order book position improved significantly, hence the divestment was put on hold.
Alcock Ashdown, originally a British-owned company, was taken over by the Government of India in 1975 and then by the State Government in 1994 following liquidation.
Its entire paid-up equity had been paid by the State Industries Department, Gujarat Industrial Investment Corporation (GIIC) and Gujarat Maritime Board (GMB) and the State Industry Commissioner has been its ex-officio chairman.
AAGL has two ship-building yards in Bhavnagar and Chhanch (Amreli) districts in 27 acres and 10 acres in the coastal Saurashtra region. AAGL is engaged in the activities of ship building and repairing on the western coast of Gujarat. It is a zero debt company with confirmed orders and price negotiations.
