As part of the strategic sale process, the Government is spinning off Shipping House and Training Institute and some other non-core assets from Shipping Corporation of India (SCI).

“The split-up process is time-consuming. We would be ready to seek financial offers in 3-4 months,” the official said.

Shipping Corp’s Board of Directors met last week and approved an updated demerger plan for the spin-off of SCI’s non-core assets to Shipping Corporation of India Land and Assets Ltd (SCILAL), including Shipping House, Mumbai and MTI (Maritime Training Institute) , Powai Completed the process of carving out all non-core assets into the new SCILAL company.

According to SCI’s balance sheet, the value of non-core assets held for demerger as at 31 March 2022 was Rs. 2,392 crore.

The SCI Board approved a demerger plan to spin off the identified non-core assets in August last year and formed SCILAL in November 2021 to hold those assets of the company, which reports to the Department of Port Shipping and Waterways.

The Ministry had directed SCI in April 2022 to expedite the process of spinning off SCI’s non-core assets to SCILAL, and also asked SCI’s Board of Directors to review the spin-off plan for the spin-off of the non-core assets, including Shipping House, Mumbai, check and MTI, Powai.

“Such changes have no impact on the carrying value of non-core assets in the financial statements. Implementation of the plan, including the amended plan, is ongoing and given MoPSW and DIPAM’s reiteration of accelerating the demerger process, there is a certainty of the completion of the process in the near future…” according to the report of SCI’s independent auditor , which was submitted to the Board of Directors.

In March last year, the government received several offers to privatize the Shipping Corporation of India.

In December 2020, the Department of Investment and Public Asset Management (DIPAM) invited for an Expression of Interest (EoI) for the strategic divestment of its entire 63.75 percent stake in Shipping Corp of India along with the transfer of management.

In November 2020, the cabinet approved the strategic sale of Shipping Corp.

The privatization of SCI should now be completed in the current financial year. The Government has budgeted to raise Rs 65,000 crore from the CPSE divestment in the current fiscal year 2022-23.

While the government has already raised Rs 3,000 crore from the sale of minority shares in ONGC, a further Rs 21,000 crore would come from Life Insurance Corporation’s ongoing IPO this month and Rs 211.14 crore following the transfer of management control from Pawan Hans to Star9 Mobility Pvt Ltd, a consortium of Big Charter Pvt Ltd, Maharaja Aviation Pvt Ltd and Almas Global Opportunity Fund SPC, by June.